by Mick Marshall

Created on: February 09, 2007   Last Updated: April 15, 2007

PHILOSOPHY - one of the 3 important considerations.

In this age of easy internet access, One of the more tempting opportunities for investing is by trading shares on the stock markets. In a previous article I put forward the view that before trading anything on the stock market, 3 important things need to be considered carefully. Here, I want to expand on just one of those issues. This one is about PHILOSOPHY. (The other articles can be found via the author page.)

So, What has philosophy go to do with share dealing?
Trading in shares is no different from any other activity; if you have the right philosophy, it will be better. I do NOT suggest that it will be more profitable. Just that it will be a better experience
As a human being, you will have in your head, a generalized view on life. A guiding principle to help you get through the ongoing mayhem. This Philosophy', is a product of the physiological frameworks that are constantly forming and changing in your mind, and have been doing so since birth.
You will by the time you are an adult, have a collection of solid views, relating to various parts of your life, each one, a sub-philosophy in its own right. Guiding principles to help you deal with those smaller issues. If trading is going to be a part of your life; you need a philosophy. If you jump right in, your brain will create one for you anyway, over time; but in the meantime, it will cost you in cash and grief. That's why I advocate working it out first.

Some peoples have better philosophies than others; that is to say, some are more effective and helpful, than others. What is good for one is not necessarily, good for another. What is good, is what works.
Some believe it is a very solemn and serious business, and treat it with great reverence. Some append a social status to share ownership that is out of date and imaginary, but it boosts their self-esteem.

I ,on the other hand, do it for the fun. I believe that all ventures in life should have an element of enjoyment in them. Otherwise, what's the point anyway?
I trade because the movements of the markets interest me and I can see there is massive potential for becoming very rich. I don't trade huge amounts. I try to spread my risk by putting smaller amounts into several companies. I consider each trade as a purchase' as if it were paying the electricity bill, or buying a coat for the kids. In this way, I feel that the money is spent, gone, used. I don't have the conception in my head that it can be retrieved

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