Photo: Carsten Schertzer / Flickr
Millionaires are booming in the U.S. Since 2008, the country has added 1.1 million millionaires to its roster –– a growth rate of 28.6 per cent.
What do they know that the 99% don’t?
There’s one key investing concept millionaires have mastered, according to Brent Fykes, a senior investment partner at GenSpring:
They know when to stop being greedy.
“[Most average investors] tend to want to dabble in the stock market and buy the latest hot stock like Facebook or Apple,” he told Bankrate.com.
On the other hand, wealthy investors “by nature are less risky because they’ve created a nest egg and don’t need it to grow at incredible rates … They just want to stay rich. On the whole, the 99 per cent is in the get rich mode.”
And that’s where we get tripped up.
This passage from Investopedia drives the point home:
Perhaps the No.1 killer of investment return is your emotions. The axiom that fear and greed rule the market is true. Do not let fear or greed overtake you. Focus on the bigger picture. Stock market returns may deviate wildly over a shorter time frame, but over the long term, historical returns for large cap stocks can average 10 to 11%. realise that, over a long time horizon, your portfolio’s returns should not deviate much from those averages. In fact, you may benefit from the irrational decisions of other investors.
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