Let me begin by saying that I love people. People fascinate me. I love learning what makes them tick (pun intended). Why they make their decisions? What fears do they have? What hopes do they have? What is holding them back? Why do some excel while others don’t? Why do successful people succeed at what they do (agree with Todd, hasn’t nothing to do with wealth) while others constantly fail. There are many answers that are beyond the scope of this article. But some common traits successful people share are: focus, tenacity, ability to overcome weakness/obstacles, the ability to remain objective,. analyze facts- not opinions, make hard decisions, change when the facts change, and most important they think right (they know what they want most then work hard to get it).

There is an old Wall Street adage that says, making money on Wall Street is simple but not easy. I couldn’t agree more. After studying countless people, I’ve learned that most people fail because they make emotional, not rational, decisions on Wall Street. Most people love money (even though money doesn’t know or love them). So they invariably make emotional decisions when their money is on the line day in and day out. Instead of looking at the chart to see if anything went wrong, they look at the account tick higher and lower. Then end up making hasty decisions. This process causes them to hold on to their losers or sell their winners too soon (successful investors do the exact opposite).

Another reason why most people fail in this business is because they don’t make smart decisions (trying to put this nicely). [Full disclosure, I do not trade in penny stocks, they never appealed to me, nor do I have any interest in trading them. Everything I do deals with liquid institutional quality stocks]. So when I saw this headline earlier this week, I couldn’t help but think- Really? Why would anyone in their right mind in today’s day and age fall for this nonsense??? But people do, they always have and always will. Another adage says: “There’s a sucker born every minute.“

My solution is to always ask myself (in life and in markets) Is this smart? Before I make any decision, large or small. Try this for a month, and you will be AMAZED and how often you catch yourself making “questionable” decisions. Next time you buy or sell a stock- ask yourself is this smart?