Morgan Housel: The Only Thing That You Can Control In Investing Is Your Own Behavior

Johnny HopkinsMorgan HouselLeave a Comment

A couple of years ago Morgan Housel did one of the best presentations on investing titled – What Other Industries Teach Us. The presentation features a number of stories that teach us about human nature and why so many investors are their own worst enemies. It’s a must watch for all investors. He finishes the presentation with the following:

To wrap this up I think if there’s something that underlines all of these stories today it’s that the biggest risk to you as an investor is yourself and your own biases, your own misconceptions, your own behaviors, that impact your returns as an investor.

When people talk about risks they talk about what is the economy doing? What is the Fed gonna do? What is the CEO of the company I own going to do? And those are all risks.

I think they absolutely compare to the risk that you yourself pose to yourself as an investor. For some people that’s kind of a difficult realization. To know that you are maybe taking all these actions that hurt yourself. To me I think it’s one of the most optimistic realizations in investing because you can’t control what the economy is going to do next. You can’t control what the Fed is going to do next. The only thing that you can control in investing is your own behaviors. When you realize that the one thing you can control is the thing that makes the biggest difference over time… That I think is a pretty optimistic realization.

So I want to end today with a quote from an investor named Bill Bonner. He says, “People don’t get what they want or what they expect from markets, they get what they deserve.”

You can watch the entire presentation here:

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