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This chapter is from the book

Character Traits and Personal Qualities

A Valuegrowth investor has to develop a frame of mind that sets him apart from other investors. The qualities needed include intellectual independence, capacity for hard work, and an ability to make decisions with incomplete information. Investors must also resist the temptation to speculate. Also patience, perseverance, fortitude and consistency are called for. And last, but not least, the willingness to admit and learn from mistakes.

To have an edge in investment, we must develop relevant capabilities the main body of investing public either do not have or choose to ignore the importance of. All the investors discussed in this book bring up time and again how amazed they are that most investors follow the latest fad or pursue a strategy that has a track record of failure, even when the lessons of history and the observations of wiser counsels show a better way. The superior approach is not too complex, and yet most investors do not follow it despite the widespread availability of knowledge of the key elements. Why don't investors switch from the illusory glittering path been followed by the crowd? This largely remains a mystery. Perhaps it is a case of memories being so short that the lessons of more than three of four years ago are forgotten. Perhaps people are easily persuaded by "expert" opinion, which is usually merely crude extrapolation. Perhaps it is group-think on a vast scale. Or maybe it is because the investment philosophies discussed in this article require focused thought for successful implementation.

The foolishness of the majority of investors throws up bargains for the Valuegrowth investor.

Successful investing does not require great intellect; it requires great principles.

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