Angel Investors Network Blog – Secrets of Successful Investing

Secrets of Successful Investing

Secrets of Successful Investing

Michael FuglerWe are going to start with some basic guidelines, which will vary from person to person but are worth considering for you.

Know Who is Responsible
There’s only one person responsible for the investments you make-If you want to be successful, you have to take 100% responsibility. Most of us have been conditioned to blame something outside of ourselves for the parts of our investments we don’t like, stop it! It’s all up to you.

How Much Can You Afford to Lose?
Far too many gamblers go into a game with only a vague idea of how much they can afford to lose. Don’t! The smart ones learn to know exactly how much they can spend and stick to it. The same is true for an investor. Remember that ‘Just one more investment’ is the loser’s mantra! Another point that’s crucial to remember is that you must NEVER, under any circumstance, invest with money you cannot afford to lose.

Know What Success Really Means
If you can figure this out it will make the investment journey a lot easier. If you are going to just measure wealth and success by dollars, its going to be a rough road but if you are thinking more along the lines of how many of the people you want to have love you actually do love you, maybe you are on a better track but that is for you to figure out. It should end up being the ultimate test of how you’ve lived your life.

Liquidity
This is so important, we will be talking a lot about this one. How and when can you get your money out?

• Be Willing to Be Different
Don’t base your decisions upon what everyone is saying or doing. Contrarian is sometimes the best position.

• Don’t Over Cook a Decision
Get access ASAP to any information you need to make a decision, give yourself a reasonable time and stick to a deadline. Hopefully in time you will learn to make up your mind and act on it.

• Calculate the Value of the Opportunity to You in Advance 
Your leverage is always greatest before you begin a job — that’s when you have something to offer that the other party wants.

• Valuation of the Deal Itself 
Entrepreneurs constantly want to value their deal now based on getting your money and everyone else’s and figure future earnings into the mix? What? Really? We are going after this one big time because it happens all the time. Ever watch shark tank, tell them Mr. Wonderful.

• Watch Small Expenses in a Deal 
Investing in a company that isn’t mindful of small expenses will probably not be mindful f the large ones either.

• Assess the Risks-Due Diligence will be the focus
There are always risks, we are going to find them and discuss them.

• Limit Your Debt
It doesn’t pay in this volatile market place to borrow a significant amount — not to invest, not for a mortgage. Many investors think their borrowing is manageable but become overwhelmed by debt.

• Know When to Quit
Or at least when to take a little off the table of success and diversify further. Let’s have some fun and make some money!

Michael Fugler

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