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23
Nov

Analysis paralysis - Suboptimal Decision

Some people find themselves in a troubling situation where they can't stop thinking, they overanalyze and search for patterns. It comes from big ambitions and an urge to finish a job as fast as possible, cursing us into a 24/7 analysis paralysis mania. This burden could disrupt our peace, bring needless stress, and worry into our daily routine. Sometimes, this wicked sequence is a waste of your precious time and keeps your mind in 24/7 exhaustible drills. Balance yourself and stop drain your energy. Gaining control over this nasty habit is a must if you want some peace in your life and mind. 

Build your decision-making process quicker and more efficiently. Eliminate too many options when you find yourself in a problematic situation.

Text: Suboptimal Decision

Jams and Investments

Two psychologists Sheena Iyengar and Mark Lepper conducted a study to determine the power of suboptimal decisions. A particular study was conducted with a variety of jams displayed in an array in a shop. Every shopper received a coupon if he sampled a jam, and with the mentioned discount, he could buy any of the jams later.

The next day, they cut the number of jams on display and received less interest than with the big display on the previous day, but those who saw the large display were only 1/10th likely to buy jam than those who saw the small one.

You can find parallels with looking for the right investment at the exact time. Too many options could mix up your mind and disturb it with extended decision making. This could be way worse than a suboptimal choice.

Investments are not a game of chess. This is not a perfect information activity. You can find a perfect solution too late and in this way, you might miss out on positive returns compared to the returns from the suboptimal decision.

Text: The Pareto Principle

The Pareto Rule in Investing

The Pareto Principle states that 20% of the effort exerted creates 80% of the results. So why not focus on that 20%? Two things that investors have direct control over are the fees they pay for their investments and their savings rate. 

Our goal is to help people nail those 20% activities, the things that truly move the needle with their investments. That's why we have introduced a Pareto rule on investing within the FAST INVEST loan list. 

  1. FAST INVEST set a minimal investment to loan. The investor needs to invest at least 20% of the loan's worth. 
  2. If your balance is lower than 20% of the loan's worth, you are required to invest your balance fully!
  3. If the investment part is lower than 20% of the loan's worth, you must invest the rest of the loan amount!

FAST INVEST encourages everyone to focus on the handful of essentials in investing that truly make a difference.

Text: Focus on Goals

Make Your Goal

One of the most important steps towards your financial freedom is figuring out why you are doing this. Make your plan, and it will help you to stay on track. This is essential to build your routine and manage your smart financial decisions.

Discipline, consistency, and patience to strengthen your plan and tune out the collateral noise. Don't focus on beating gossips; focus on your goals.

Text: Diversify

Diversify Your Investment Strategy

In most of our articles, we remind you about diversification. With FAST INVEST, you don't need to invest in several loans; you want to spread across the entire loan list. The reason is simple. A few individuals can tank, but it's almost impossible for everyone to have problems in an efficiently diversified portfolio. It could help investors to have a polished investing path and strengthen returns in a long distance.

Text: Manage Your Irrationality

Irrational Decisions

As you know, we humans are very emotional and sometimes making irrational decisions. This is a reason why we are naturally very weak investors. Investing requires logic, calculations, discipline, consistency, and patience. Keep your greed intact, and lock your fear. Act logically and with a cold mind.

Text: Final Thought

Don't confuse luck with skill

Remember crucial aspects of right investing:

  • Discipline
  • Consistency
  • Patience

Mentioned virtues bring you a positive result. Don't confuse luck with skill. If things sound too good to be true, on the one hand, it is luck or scam. Successful investing should be boring. It doesn't happen overnight but doing the right things daily over time enables you to reach your goals. 

Text: The Art of Investment - FAST INVEST

Posted on 23.11.2020