A mistake that novice investors often make a lot is to count the profits ahead of time, that is, they count the chicks before they hatch, and this is always counterproductive for more than one reason.
One of the most foolish things we can do when investing is to count the gains before they occur, because there are a million things that can cause the course of the market and our investment to be altered unexpectedly.
It is very easy to make forecasts, but if we do not have the wisdom and self-control to understand that we must be prepared for our worst case scenario, then we will end up losing more money than we earn.
Because by counting the gains before they occur, we will be excessively optimistic, to the point that we will lose touch with reality, and when that happens, the losses will be guaranteed.
We must always be very prudent with anything we do when investing in the markets, because our profits will ultimately depend on it. In this sense, we must focus on the worst possible scenario when investing, that is, what would happen if all our investment collapsed? would we just lose all our money? Or would we have some escape plan? Would we have an action plan for such a contingency? Would we really know what to do?
If we have a contingency plan, nothing will take us by surprise when it comes to investing, and the losses, even in the worst case scenario, will be minimal and bearable by our pocket.
What do you think about it?
