The Difference Between Amateur & Professional Investors

I meet thousands of investors through my daily meetings, webinars, social media, and what I see is that everyone is hustling to be a Pro in Investing.

In this online world full of information everybody who has access to the information more than the average people have, they feel like they know how to do it and if they do it consistently they can become a pro in investing.

I agree with the fact that “if you put in 10,000 hours of practice in anything, you will master it.”

Apart from this fact, what I feel is that majority have misunderstood the actual difference between an Amateur & Professional Investor.

They try to be like a Professional Investor but in reality, they act like Amateur. Let’s understand the difference between Amateur & Professional Investor.

Amateur & Professional Investor

• Amateur Investors look at Stock Markets as ticker tape, Professional Investors look at it as a Place to Buy Ownership in Great Businesses.
• Amateur plans to gain 20-40% and exit from investments, Professionals plan to compound their investments consistently for decades and exit only when they actually need money.
• Amateur looks for the best funds or best stocks to buy, everywhere, Professional looks for consistency and stay invested in them.
• Amateur finds an easy way of investing for earning quick money, Professional finds best investment opportunities to compound wealth consistently and patiently.
• Amateur gets panic when the stock market falls and stops their SIPs, Professionals become greedy whenever the market falls and in fact, they increase their SIP amounts.
• Amateur tries to add new funds in their portfolio for better performance, Professionals understand that it’s about patience and consistency that will improve the performance not the number of new funds in the portfolio.
• Amateur listen to every random advice and takes their investment decision, Professionals have his full-time trustable advisor on whom he can rely and discuss to make the decision for his investments.
• Amateur thinks whatever his banker or uncle is suggesting is right for him, Professionals understand their requirements and they cross confirm whether his banker or uncle is suggesting fulfills his requirement or not.
• Amateur tries to time the market based on sentiments, emotions, etc. Professionals stick to their strategy no matter what are the sentiments or their emotions.
• Amateur deviates from their initial strategy if someone suggests something new, Professionals know that they have started their strategy based on its fundamentals and have faith in it. So, they won’t change it until they actually achieve their goals.
• Amateur read news, noise & information. Professionals read books, experiences, case studies, behaviors, and reports.

The list of differences goes on and on…There are many more differences between Amateur and Professional Investors.

You have to know what you have been doing and who you look like more? Amateur Investor or Professional Investor?

Let me know your views by replying to this mail, or if you’re reading on the website then by commenting below in the comment section.

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