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Listen to Your Gut!

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The importance of intuition in investing

The day before I closed my first rental property, I was still wavering back and forth. “Should I buy it, or shouldn’t I?” I kept asking myself, over and over again. And every few minutes I kept switching back and forth from saying yes to no to yes again.

I was driving myself crazy!

In the end, I said to myself, “You’ve gathered as much information as you can. At this point you’ve got to trust yourself.”

I closed on the property the next day, and it was the right decision.

Go, no-go

Over the years, I’ve always struggled with this go, no-go scenario, going back and forth between whether I’m making the right investment decision or not.

If we’re honest, we’ve all been there. It’s part of what makes us human. I’ve learned from these experiences the importance of trusting myself—of listening to my intuition. Sometimes, I’ve learned the hard way.

Early in my investing life, I purchased some shares of Coca-Cola through a stockbroker whom I met through a mutual friend. After I bought them, I didn’t pay much attention to them, until one day I looked them up and realized I had made a nice little profit. I called my broker and told him I wanted to sell.

Long story short, the broker played the professional card, guaranteeing me that the stock would go up. I fought him on it, but in the end, I caved. Within one week, the stock took a dive, and I took a loss.

My biggest mistakes

My biggest mistakes, not just as an investor but in life, are the times when I didn’t trust myself—when I allowed people to persuade me to take actions that I didn’t agree with but went along with anyway. It’s times like these, when I’m not true to myself, when I go against what is congruent with my thoughts and beliefs, that get me into the most trouble.

Intuition, plus

This is not to say that I rely only on my intuition. If I start in with the go, no-go questions without doing my research and getting the facts, and I base my entire decision on my gut feeling alone, then I’m being foolish.

I’ve found that the more deals I do, however, the sharper my intuition becomes. Intuition plays a key role in the world of investing, but it’s not a solo performer. Intuition plus experience, intuition plus knowledge, intuition plus advice…these are potent combos.

I don’t lead with intuition alone, but I am always checking in with my gut feeling. I do my homework. I gather my facts. I ask around. And I check in with myself. It’s important to never forget to do that! If everything lines up, then I move forward.

So, the question for you today is, “What is your gut telling you?”

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Original publish date: February 05, 2015

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