Throughout our lives, we have to make several critical decisions, eg. choosing our own profession and life partner. We may not understand that buying a stock is actually same as finding a business partner, an important decision in life, especially if we want to grow our wealth.
Why some people become richer over the years? This is because they get to know good business partners. When we buy a stock, it actually means we are in partnership with someone doing business together, could be short term or long term partnership. If our business partners could make money, we would also profit from them because the company earning could be shared with us in the form of capital gain (higher share price) and passive income (dividend). If we make friends with partners who are losing money quarterly and yearly in business, this is as if burning money, we will lose out in the long run with these junk stocks.
Therefore, it is important to learn how to choose the right business partners who could make us richer over the time. One could perform fundamental analysis to analyze the company performance through studies of 3 financial reports: income statement, balance sheet and cashflow statements. However, choosing the right partner (stock) also requires the right timing. We have to pay different prices to make friends with them, depending on how many friends they have now. When there are many “likes”, usually the friendship is very costly, one has to pay a high price to buy a desired stock in bullish market. On the other hand, when a good business is emerging or when the investment market is bearish, they will have less friends, it will be easier for you to make friends with these giants stocks or business partners at low cost because you pay relatively lower share price.
After we choose our career or life partner, it is hard for us to switch. However, we could have many choices for business partners because we could choose what stocks to buy. A wise investor would review the investment portfolio regularly, ensure the business partners are strong, occasionally could be replaced with new blood to strengthen the future performance. When you like any good fund or business in the world, as long as they are listed in stock market, you could make friend with them easily by buying their stocks, just wait for the right timing.
Both traders and investors should learn the unique Optimism Strategies developed by Dr Tee to choose strong global stocks as the right business partners will help you to grow your wealth.
