Have you heard that saying before?
Underneath this common saying is some advice that is profound and a key to successful investing & to life in general.
Many people are held back from achieving the desired results they want because they fall in love, or more accurately, in lust with their investments.
This often leads them to “bank” their profits before they are realized. In other words, they imagine how well the investment will go or is going, and they start to mentally “spend” this money or worse, they start making new investment decisions assuming this money is real.
It’s not real – not yet anyway.
Most investment decisions are emotionally based, as opposed to fact based.
Unsuccessful investors often begin counting their gains (& losses) before a transaction is actually completed.
as unsuccessful investor will spend their profits before the money is in the bank.
Conversely, they will tend to stay in a loosing transaction longer then they should, in the hope that it will get better.
This behavior doesn’t serve us well. We need to endeavor to remove emotion from decision making, in order to improve our investing performance.
Therefore, don’t bank your unrealized gains or losses until they are completed.
Always seek hard data to base your decision making on.