Benjamin Graham on Investment Emotions

Investing can quickly turn into gambling if we monitor it too closely. Emotions can get the best of us when we are trying to time the market. I’ve experienced this and have lost thousands due to fear and exhilaration.

Benjamin Graham, described as the father of value investing, once said:

“Individuals who cannot master their emotions are ill-suited to profit from the investment process.”

Indeed, there was a time in my life where I was ill-suited and didn’t realize that my emotions were lowing my ROI. If a stock was skyrocketing, I would BUY BUY BUY! If it was plummeting, I would SELL SELL SELL! In other words, I was buying when the market was high and selling when the market was low. BAD IDEA.

Because I now realize that I can’t trust my emotions when it comes to investments, I require a system to keep me in check. When we begin investing again (many years from now), we’ll do it with a plan and long-term mentality.

Emotions can be damaging to your portfolio. Tuck Graham’s words into the back of your mind, and don’t forget that handling stocks aggressively can be the end to a great retirement.