gmail - investors personality profile report
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16/12/2015 Gmail - Investors Personality Profile Report
https://mail.google.com/mail/u/0/?ui=2&ik=d72f2a0afb&view=pt&search=inbox&th=151aaa15f11dcd04&siml=151aaa15f11dcd04 1/3
Alvaro Moraza <[email protected]>
Investors Personality Profile Report1 message
IPP <[email protected]> 16 December 2015 at 12:51Reply-To: IPP <[email protected]>To: [email protected]
The chart shows graphically how you rate as an Analyst, Trader and Actuary.
And it should be immediately clear which of those three styles you are most compatible with.
Your Analyst score is 90.00
The Analyst archetype is personified by Warren Buffett who carefully thinks through all the implications ofan investment before putting a single dime on the table.
The Analyst may research an investment for months before making a final decision. He wants to understandas much as he can about any investment before he takes any action. But, the minute he DOES decide toact, he follows the 11th Winning Investment Habit and acts instantly.
Of course, not everyone who prefers the Analyst style invests like Warren Buffett. Far from it.
Every investment style that has, as one of its components, what is loosely called "fundamental analysis"requires the abilities of the Analyst. For example, the Trader who (like Soros) aims to profit from shifts inmacroeconomic trends must devote a great deal of time to research so he can feel certain that the trades heenters will be profitable.
Similarly, the Trader who specializes in a few commodities or currencies; the arbitrageur; the investor whospecializes in shorting stocks he considers overvalued...to be successful they must all have many of thequalities of the Analyst.
The only exception is the technical analyst or commodity trader who follows a pure Actuarial approach (seebelow). While this type of investor does not analyze any individual investment, he must, nevertheless, havesome of the skills of the Analyst to research, develop, and hone his system.
If your Analyst score is less than 50% it’s important to improve your skills and abilities in this area.
16/12/2015 Gmail - Investors Personality Profile Report
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Your Trader score is -10.00
The Trader archetype is epitomized by George Soros who can act primarily from unconscious competence– what most people would call “intuition.”
The Trader can also act decisively, and instantly on incomplete information, trusting to his "feel for themarket."
One ability that sets the Trader apart is that he never hesitates. He is always prepared to take instant action,especially when the unexpected occurs.
He is also capable of comfortably handling situations that, for most people, would be sources of great stress.
If your Trader score is less than 40% you’d be advised to avoid trading or speculating entirely.
You can invest successfully, even if you do not have the predisposition of a Trader, by steering clear ofinvestment methods that require quick decisions and fast action.
Needless to say, regardless of your investment style there can be times when the skills of the Trader wouldcome in very handy. So it would still pay you to improve your abilities in this area, even if your personalinvestment system isn’t centered around trading.
One way is to improve the certainty with which you make investment decisions: then, when the time comesto act, your course of action will be clear and you’ll have little reason to hesitate.
Your Actuary score is 26.09
The Actuary archetype acts like an insurance company in reverse. An insurance company will write a largenumber of policies on a similar class of events. For example, the risk that your car will be involved in anaccident.
The company has no idea whether your car will ever crash. And nor does it have any idea whether anindividual vehicle will experience a minor dent, or be totally written off.
What the insurance company can calculate is the average probability of claims per thousand policies it haswritten. And provided it has priced its policies correctly, it can be sure of making a profit – regardless of whathappens to any individual automobile.
In the same way, the Actuarial investor has identified a class of investments that he knows -- if he buys themat the right price -- will make an overall profit, regardless of whether he suffers a loss on any individualinvestment. Like the insurance company, the Actuarial investor’s primary focus is on probabilities.
The legendary investor, Benjamin Graham, would only buy a stock at 35% to 50% of its liquidation (orbreakup) value. Since he only investigated the numbers, and did not look at the management or thecompany’s products in any detail, he had no way of knowing in advance whether any single stock he boughtwould be profitable.
But he did know that by purchasing a large number of such stocks at the right price, he would make moneyoverall.
Like other Master Investors, Graham did not operate solely from this one perspective. Indeed, as the author ofthe classic investment books, Security Analysis and The Intelligent Investor, he is also known as a MasterAnalyst. Which indeed, he was. That’s how he identified the stocks he bought – but his investment systemwas actuarial in nature.
The extreme example of an Actuarial investor is the commodity trader following a computerized tradingsystem whose buy and sell instructions are generated and placed automatically by the computer.
His focus is not on any of his individual investments. He spends his time attempting to improve the reliabilityand profitability of his system.
One of the essential components – for such an approach to be successful – is a set of strict money
16/12/2015 Gmail - Investors Personality Profile Report
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management rules that limit the amount of your overall capital put at risk in any individual position to a smallpercentage of the entire portfolio. As a result, his portfolio will usually consist of a large number of individualinvestments.
If your Actuary score is less than 25% you would be advised to improve your understanding of probabilitiesand how they can be used in the investment world.
The Master Investors like Warren Buffett, Carl Icahn and George Soros can each act from all of these styles.Nevertheless, they each have a clear predisposition for one particular style.
So, should you wish to be a great investor like them, you’d be advised to master all three styles even thoughyou will primarily act from just one of them.
If your ambitions are not quite so lofty, it will pay you to be clear about the style you prefer. And to choose aninvestment area that’s compatible with it.
One of the secrets of the great investors’ success is that they develop investment methods that arecompatible with their personality.
This survey will, we trust, help you focus on the kind of investments that are right for you.
If you have any comments, questions, or feedback of any kind we'd love to hear from you. Just [email protected].
PS. My Investment IQ Test is a companion to this one. You see your Investment IQ compared to that ofBuffett, Icahn and Soros -- and get a 9-page report, based on your answers, to help you implement the 23winning investment habits in your own investment. Take a look at http://www.marktier.com/IQ-test.htm.