At some point in your life, you’ve won a game you’ve never played before or witnessed a young child say or create something with worldly depth. These are both examples of events we attribute to something called beginner’s luck as if chance caused them to happen. – Lifehacker
Investment – When someone starts investing and he has reaped good returns on the initial investment. Then he starts thinking that he pursues an above-average skill and knowledge which has rewarded him well. This is known as beginner’s luck and that makes novice investors blind to making wise decisions and efforts.
The stock market always checks novice investors with beginner’s luck and those who can come out of the trap, can have a better chance to survive further. We should focus on long-term success rather than one year or a month of success. Sometimes, novice investors earned an above 50% return on their investment and they start thinking of themself as talented as Mr. Warren Buffett. Nowadays, one-two correct bets promote them from analysts to fund managers. They started to manage the funds of family and friends.
We should understand that the stock market is a sea and, we need to have remained lifelong students to walk in the depth of the sea. Not a master, because the master is always a market.
We should not get excited by one or two of success but have to remain grounded by focusing on long-term success. If we keep meeting success during a longer horizon then we can consider ourselves mature investors.
This entire series will be reviewed with various examples from books which are “Thinking, Fast and Slow” and “The Art of Thinking Clearly“.