Should investing be exciting? Should it get your blood pumping and make you stay up at night? It depends on what you want, and what you get excited about.
My take is that (assuming you’re investing for your future) the act of investing should not be exciting. If you get a rush of adrenaline when you make trades in your account, odds are that you’re trading based on emotion and not on your long term goals. And the word “trading” is probably the best description of what you’re doing. It may be similar to how some people feel when placing a large bet at a casino. When you trade short-term, your odds are probably about as good as they are at the casino tables.
Getting Exciting
So what about investing should be exciting? Well, your reasons for investing are probably pretty exciting. Your goals, your hopes, your future… If that’s what motivates you to invest (as opposed to a a quick “fix” from making a quick profit), then you’re probably on the right track. Get excited about a future where you’re comfortable and you can make choices about what to do with your time (and what not to do).
Unfortunately, that kind of investing is not very entertaining. But that’s probably the approach that’s more likely to lead to success. OK, fine, some people make tons of money with short term trading. But trading is extremely risky (isn’t the stock market risky enough as-is), and it’s more likely that you’ll crash and burn than shoot the moon.
This is why you need to keep your goals in mind as you invest. Remembering where you’re going and how you plan to get there will improve your chances. You won’t be tempted by “hot opportunities” that fizzle out and you won’t invest with the goal of having a great story to tell at cocktail parties. You’ll be able to stay disciplined and work on your goal.
So ask yourself and visualize: what do you want? How will your future look? What experiences will you have? What experiences (that you currently have) can you stop having? Then, it’s time to get to work and figure out what it takes to make those things a reality. One way to get there is through textbook saving and investing over the long term (boring stuff… blocking and tackling). Other ways include striking it rich by winning the lottery or being a better stock trader than anybody else. Only you can decide what path seems realistic and seems to fit your situation.
But What About…?
Will you miss some opportunities if you’re a long term investor? Probably. But would you come out ahead if you bit at everything that seemed like an opportunity? Maybe, maybe not. People who trade tend to have big gains and big losses, and if they’re lucky the gains outsize the losses before they run out of money. It’s a nerve-racking way to do it if you have serious goals on the line. If you’re just looking for entertainment – and you’re willing and able to pay the entrance fee – that’s one thing. But just be sure to acknowledge what you’re really doing and where you’re putting yourself on the risk/reward spectrum.