Investing: Main
- personal995
- May 19, 2024
- 5 min read
Updated: Dec 5, 2024
The protection and compounding of time, knowledge or capital for the resources required to live in alignment with your values and goals.
Introduction
Investing for individuals involves strategically allocating financial resources into various assets such as cash, stocks, real estate, or funds, with the aim of generating income or appreciation over time to achieve specific financial goals. It requires careful consideration of risk tolerance, time horizon, and investment objectives to build a portfolio that aligns with one's financial aspirations. By effectively navigating the investment landscape, individuals can grow their wealth, hedge against inflation, and work towards securing their financial future.
Definition
Investment: “The act of putting money, effort, time, etc. into something to make a profit or get an advantage, or the money, effort, time, etc.” - Cambridge Dictionary
Inter-relations
All steps are ultimately inter-related to each other to create your experience. However, these are those most closely related to Financial Management:
Security & Shelter (Basics)
Energy Management (Health)
Income (Finance)
Emotions (Potential)
Professionalism (Competence)
Independence (Autonomy)
Judgement (Wisdom)
Process
Review the Investing: Models & Theories:
Do any suit yourself and your situation? Or does a sum of parts approach suit you better? If none suit, move on to the Self Review, Lessons and Case Studies and create your own working model.
Take the time for a Investing: Self Review:
Are you being honest with yourself? Do you truly know your position and progress? In the tradition of the Socratic Method, check in with yourself.
Survey the Investing: Lessons:
Where can you improve? What are you missing? Where are your roadblocks? Others have learnt these the hard way, so you don't necessarily have to.
Take in the Investing: Case Studies:
Who do we choose as our distant mentors or anti-mentors? Who do we want to emulate for specific traits? Take heed of the stories of others. We are a storying telling species, they help us remember.
Curate your Investing: Library:
Live vicariously through the biographies of others. Learn the lessons of history and life through the many texts since antiquity. These help us go deeper, absorbing the learnings, lessons and experiences of the many before us.
1. Models & Theories
Models & Theories are essential tools for understanding, exploring, and interacting with the world around us. They help us unlock the mysteries of nature, solve practical problems, and drive progress and innovation in various fields of human endeavor.
With that in mind, first we want to align this with what we are trying to achieve. Ultimately we want to grow and achieve our Goals. The Models & Theories then, need to help us to formulate strategic plans that can do just so.
The thing with strategic plans is they are more often than not dealing with systems of chaos (human nature, environments, economies, complex adaptive systems etc), and as such can not be completely fixed. They need to be adaptable.
Dwight D. Eisenhower, the American military officer and statesman, once said, "In preparing for battle I have always found that plans are useless, but planning is indispensable."
There are very few perfect models or theories that suit every situation. Every individual's unique goals have specific requirements to successfully execute them.
However, there are often general, timeless, adaptable or customisable Models & Theories that can be utilised to begin building momentum, or which are suitable to create from, a unique and flexible strategic plan.
These Models & Theories are selected and continually curated with this aim in mind.
Get creative. Use the Models & Theories verbatim, if they serve you in that form. If not, use them purely as idea generators, as partials to build upon or as starting points to adapt and customise.
If none specifically suit, move on to the Self Review, Lessons and Case Studies and create your own working model.
2. Self Review
Richard Feynman, the great physicist, once said, “The first principle is that you must not fool yourself — and you are the easiest person to fool.”
We need to check in with ourselves and keep ourselves honest. We all stray from our Values, Goals and The Path. That is normal, that is okay. What we do when we realise we have strayed is what matters.
The Socratic method is a form of cooperative, argumentative dialogue to stimulate critical thinking and illuminate ideas. It is named after the classical Greek philosopher Socrates, who employed this method in his teaching.
In the Socratic method, instead of providing direct answers to questions, a person engages in a dialogue to explore and clarify their own (or others) thoughts and beliefs. This process involves asking and answering questions to stimulate critical thinking and uncover underlying assumptions or contradictions.
When applied to the self, the Socratic method becomes a means of self-inquiry and reflection.
3. Lessons
No one, knows everything. We all make mistakes. We are never correct the first time, every time. What was correct yesterday, can often be wrong tomorrow. Continual learning is the only way to progress.
STRATEGY OF ONE does not have all the answers, but it can help minimise missteps. These Lessons are actions, principles, rules of thumb, cautions and cognitive frameworks you can use to help avoid traps and build momentum through each stage of life.
Continually review and take what you need. Absorb the lessons that align with your Goals, and make them a part of your internal 'operating system'.
Each Lesson has accompanying quotes from great minds that can help us symbolise and remember the Lesson. That way we can more easily draw it from our memory as required.
The portrait that partners each quote is aimed to make you feel accountable. The individual lived, experience and made the effort to share the quote you are benefitting from. Now you can honour them by living up to it in your life and work.
4. Case Studies
Take heed of the stories of others. We are a storying telling species, they help us remember.
We often won't understand the ramifications of poor planning, preparation or actions until it is too late. We have all had to learn something over and over. Either 'the penny doesn't drop,' we have cognitive biases that hold us back, or we do not quite yet have the accumulated knowledge or experience to tie it all together.
The Case Studies are provided to help show what can happen when it all comes together or caution what can happen if it doesn't.
The Case Studies are just appetisers to get you started. Read the referenced further readings in the Library (or similar books that might more readily align with your specific goals) to really submerse yourself into another's experience and absorb the learnings.
5. Library
If you are a reader already, you have an advantage. If you are not, learn to be. Start with what interests you, and your interests will expand. Carry a book, and read instead of scrolling. When traveling, listen to an audio version.
As the great thinker and investor Charlie Munger said, “In my whole life, I have known no wise people (over a broad subject matter area) who didn’t read all the time—none. Zero."
It is a non negotiable if you want to live well. It is a part of continually improving, of gaining wisdom and of making better decisions. As it is the culmination of all your decisions that shape your life.
If we have referenced, or found a book, text or article to be foundational and useful, it will be listed throughout and also categorised for your reference below.
For your efficiency, the library provides a brief on why each book is included, and why, and for who, it may prove to be of interest or useful.
With your Investing now reviewed and front of mind, move on to your Emotions.
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