Part 2: K.I.D.S (it is all about learning)

I watched a certain Youtube video sometime back and the presenter spoke about KIDS. I think this is relevant for you and me. Therefore, let us briefly look into this concept.

What does KIDS stand for? KIDS stand for:

Knowledge,

Insights,

Depth and

Strategy.

Let us now look at each one separately.

Knowledge — gather as much knowledge as you can about a particular thing/subject. Your WHY must be clear (we spoke about some of the WHYs in the chapter before this one. You might want to establish your own WHys before you start.) Therefore, do not make this series your last stop in your journey to acquire knowledge. Get and read more books. Watch a few more webinars and Youtube videos. Your aim here is to know as much as you can about saving, investing and/or trading (do not forget to stay away from trading, it can get your fingers burned.) Also, some trading/investing platforms (I will mention some of them later in this book) you will come across have loads of information on how to get started. Make sure you go through this content. They put it there for a reason. Learn! Learn! Learn!

Insights — Be on the lookout for information/insights that can better your understanding, decision making or even point you in the direction of opportunities. Make it a habit to follow some “special” accounts on social media (Twitter, Facebook, LinkedIn etc) that will help you gather some insight. Be mindful of the quality of people you follow. There are a lot of sharks out there ready to devour small fish (I don’t know if you ever heard of GameStop? But, that is a good case in point.) A few other examples as far as insights are concerned:

• Right now people are talking and debating about the war between Russia and Ukraine. What does this say to you as far as investing is concerned?
• You might be sitting in a taxi on your way to work and someone says, “Ah, I heard that the government is incentivising renewable energy generating businesses…to encourage the production of renewable energy in the country.” What does this say to you as a potential investor?

Depth — Be a guru at this thing/subject matter. This means you are committing yourself to a lifelong learning process. Trust me, you will learn something new every day. How much you will know and master will depend on your willingness to learn and grow your knowledge base. Do not make the mistake of thinking that you know everything. You don’t. The markets humble even the most seasoned investors.

Strategy — Do not follow the crowd, have a clear HOW. Know your victory or loss conditions (that is know when to pull in or pull out.) Do not take any position blindly because a person you follow has posted something about that position. Take time to study the position and only take it if it fits into your strategy. Make it a point to have a specific strategy that you follow and stick to that strategy. Once you have taken a position, stick to your thesis (that is your pull in and pull out conditions.) The markets are noisy. Your emotions will get wild (maybe we will talk about this under risk management.) But remember to stay calm and stick to your strategy.

At the end of the day, If you do not understand something, stay away from it. If you can’t explain something to someone, you have not yet mastered it, keep learning or move on to things you can understand.

Next week we will talk about “How much capital do you need to invest”

Let’s have a conversation. How are you learning? Where are you learning from? What are some of the challenges you have faced and how did you solve them?