The Investor's Manifesto

18 traits and practices that lead to investing success

Most successful investors exhibit certain traits, beliefs and characteristics. This is a compilation of those attributes I call the investor's manifesto. Not only can the investor's manifesto help you make the most of your money, it can help you enjoy your life.

1.) I am not afraid to take risks if fairly compensated.

2.) My family and friends are more important than my portfolio.

3.) I refuse to be a victim. If my boss will not promote me, I will work, save, and invest to make my own pay raise.

4.) I understand the difference between price and value. Price is what you pay. Value is what you get.

5.) I don't own a piece of stock; I own part of a business.

6.) I understand the importance of financial advisors. Unless I plan on devoting large amounts of time to studying the art of successful investing, I will seek their advice.

7.) I put money away on a regular basis, whether it be every week, month, or quarter.

8.) I invest in myself. Every day, I learn something new. It can be taking classes at the local college, studying art, or learning a new job skill. I am my most valuable investment.

9.) I understand that the most important part of the wealth equation is time. One dollar invested tomorrow is not worth nearly as much as one invested today.

10.) I don't feel the need to brag about my wealth.

11.) In my mind "short-term" is at least five years.

12.) I understand that checking the price of my investments on an hourly or daily basis is unnecessary and a waste of my time. As long as the fundamentals of the company have not changed, the day to day fluctuations in price do not bother me.

13.) My time is one of the most valuable assets I have. Therefore, I use it wisely.

14.) Every year, I read the 10K and annual report of each company in which I have an investment.
15.) I never put money into a company unless I understand the business, am certain it is selling at a substantial discount to its conservatively estimated intrinsic value, I have personal motivations (e.g., someone in which I have great faith, boasts unquestionable integrity and a long history of business success has taken over a company that is reasonably priced), or I am engaged in an arbitrage operation. If none of these is true, I invest in equities by purchasing low-cost index funds via a dollar-cost averaging plan.

16.) I know that investing without research is gambling.

17.) I understand that over time, those who choose the buy-and-hold method outperform those who frequently trade.

18.) Unless the income from my investments (i.e., dividends and interest) are absolutely necessary to maintain my lifestyle, I reinvest them. I understand the power of compounding will cause these seemingly small amounts to increase the value of my portfolio several times over if given enough time.