Do you keep Inertia Risk in your mind while investing?
As a full-time day job holder, I have to be more careful when it comes to investment. Because I can't always keep up with all the updates, to be honest. Checking the market and doing trading every day is also not my thing. I do things randomly. It may sound dumb but it's true. In this context, I know that sometimes I would pause, and I would make poor choices. That's the major reason I keep inertia risks in my mind.
So what is it?
The investment sure comes with many risks. The least tangible one is probably Inertia Risk. It's something that can be explained as a risk of doing nothing. More precisely, depending mostly on the compound interest of our interest. It's true that the better the investment the better the return would be. But if the market crash, if you need a good amount of money to invest somewhere else; you can not have that instantly. That is the real side of inertia risks.
I used to follow this technique a few years ago. When the price of BTC was low, I used to just hold a certain amount, not trading, not doing anything. When the price went high I made some money. But I realized that if I took the risks to trade more, and invest in other coins I would be in a more profitable position.
Investor inertia is a real thing. Personally, I don't think it's a bad choice. Because sometimes we need to pause and research where our money to put. It's okay to take the time. But feeling too comfortable by doing nothing and enjoying the compound interest will not take us to the moon. That's the reality.
The risks of such action are well predictable. Wealth is created when its current use is sacrificed for a future benefit. So we are compromising on this point. Yesterday I have shared how I struggled to keep up with my financial mindset. I believe it's all because I have a secure day job. I never take big risks in investment. But that's also blocking my path to earning more.
I have learned a few things to keep going even if we fall into investor inertia. I will write that later on. But for today, share with me if you are also the one like me who keep this inertia risk in your mind when you invest.
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