Positioning Yourself for Future Success

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Part 1: Investing in the Market and Creating a New Business 

I’ve been an active market investor for over forty years, and an entrepreneur for about twenty five years. In that time I’ve learned some important lessons. Here are some:

First for investing…

1. There’s only one free lunch when it comes to investing in the stock market: DIVERSIFICATION. I realized a long time ago that there are no “killer” stocks that will make you rich quickly. My best decision was selecting a good stock broker and investing in good mutual funds that select many companies, not just one.

2. Calling highs and lows of the market is futile, but “dollar cost averaging” allows you to take advantage of the market’s average growth. The stock market has an inherent bias: over time it steadily goes upward. So, by putting a little bit of money in each month, whether or not the market is growing or contracting, you’ll make approximately what the market makes over time. Over the last twenty years, it has grown on average about 8% annually.

Now, for creating a business…

1. Business is a jealous mistress. Be loyal to it, and it will forever reward you; cheat on it, and it will make life miserable. Creating a new business takes work above all else. When I started my first business, even though I had another job, I religiously increased the number of hours I worked each month. Eventually, it turned into a full time business with full time hours. A couple of times I slipped and short changed that kind of work dedication all with less than desirable results.

2. A new business grows when you solve small problems. It’s as if a struggling new business has a personality; it takes note of whether or not you are working at solving its problems. When you do, it expands, when you don’t, it contracts. Problem solving is the key to success, not a sign that the business is failing.

No short cuts…

As you can tell, whether it comes to investing in the market or creating a new business, I don’t believe that success comes from taking short cuts. At least, that has not been my experience. I’m convinced that true value emerges only as one exercises persistence. Great financial endeavors result when one sticks with the endeavor being pursued. Whether you’re investing or creating, “patient money always wins, fast money almost always loses.”