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In order to survive as a species, people have evolved to be both risk averse and loss averse, to be fearful of such possibilities. But these attributes serve us poorly as investors. To be a successful investor, one needs to overcome that fear and to take calculated risks.
It’s been over a year since the pandemic-induced stock market meltdown and since South Africa entered hard lockdown. It is time to look back and examine what this period has taught us as an industry.
The last quarter of 2018 can be described as the worst period that investors have experienced since the global meltdown of the financial markets in 2008/9. When these moments of market correction occur, astute investors sit tight while others panic and make irrational decisions.