https://soundcloud.com/ithought-advisory/mindful-investing
Podcast Transcript
Mindful investing can at first glance sound abstract. When we define different ways of investing, we mostly find empirical ways of describing them. We quantify why we want to do something. We are able to rationalize our thoughts clearly through numbers. That makes it easy to reason. It becomes simpler to convince oneself. It is easy to convince others too. But being mindful is much more than that. It is about focusing your attention clearly on something in the present and being able to see things very clearly from there. This is hardly simple. The failure of most trend spotting efforts in investing can be attributable to the superfluous nature of one’s observation, lack of personal concentration, a deficit of psychology, and too much urgency.
We simply don’t take the effort to be truly mindful and we assume that our intelligence will ensure that our investing turns out to be mindful. Mindful investing is about emotional intelligence. It is all about how we handle ourselves and channel our thoughts. In the present, we have no way of judging this. The future will validate if we were truly mindful. So, what should we do to get closer to being mindful in the way we invest?
Firstly, we should understand and accept the present. This will greatly help us create the right frame of mind. To understand and accept the present, we need to put the past behind. There can’t be anger, regret, blame, or too much happiness about the past. One must simply focus on the present. This would mean putting the past in a silo where you look at things clinically.
The intense focus on the present gives you a sense of the future. Often, your observations and experiences from the past work towards helping that sense of the future emerge. But, if you are emotional about the past, those very emotions act as barriers to your thought clarity. They don’t let you see things objectively. These emotions hog your mental space and don’t let you move beyond that. So, one needs to learn to leave the past behind. We must at least let them rest gently by reconciling with them.
This needs training of the mind. Once you have reconciled things with the past, you start seeing the present clearly. You see things as they should be viewed. Not in the way they affected you in the past. This will help you see the future better. While you may not be able to zero in on the exact future scenario, you will be able to see the probable ones. You would mostly end up with a couple of scenarios. This clarity helps you adapt your investing significantly. You start investing in a way which adapts to the probable scenarios. In effect, you balance your approach. You also start seeing the most probable scenario better. Gradually, as you focus more intensely on your thinking and observations, you see what it takes to achieve mindful investing.
Mindful investing is a journey from within. It involves acceptance of success, failure, and waiting. It involves reconciling things between the past, present, and the future. It simply involves being the investor you need to be if you should enjoy investing. It involves shedding comparison and envy.
Mindful investing can at times turn narcissistic. The trick is to avoid taking our thinking too far and allowing a lot of margin for error. We can be wrong or right. Yet, being mindful constantly helps one move from wrong to right. What better reason can there be to make our investing mindful?