Investment Lessons From A Boardgame


Investment Lessons From A Boardgame - or what I learned from playing Risk: Take risks, but balance it with the right amount of caution and focus on one thing at a time.
Lately I've been playing a lot of Add-venture - a Risk-clone game - on my mobile phone. At first I could only defeat 1 computer opponent on an easy setting. Then I realized I needed to play more offense and be aggressive. This enabled me to defeat opponents on advanced difficulty.

But to defeat 'intelligent' opponents, I realized I needed to be more careful in guarding my territories.

And to defeat multiple 'intelligent' opponents I needed to start small and not take on more territory than I can hold. I also needed to be more judicious in my moves. I couldn't just conquer the next territory. I had to amass forces first. I had to set it up. I had to see my opponent's possible next moves.

And over time I realized that a lot of these behavior apply to investing (and probably business too).

I need to take some risks in order to make my money grow. If I focus on keeping safe the little I have, then that's what will happen - it will be safe, but will remain small.

But if I take too many risks, I'll lose what I worked hard for. This is why due diligence, insurance (not VULs!), and an emergency fund is important.

But even balancing the right amount of risk and caution won't matter if I have no focus. I have to concentrate on one thing at a time. Should I focus on growing my money through mutual funds and UITFs? Should I actively trade in the stock market (assuming I can already)? Start a business? Get a franchise? Join multi-level marketing schemes? Freelance on the side? Make money online?

Depending on my skills and the time I can allot, all of those are viable options. However doing all of them at the same time will most likely lead to failure.

But if I focus on one thing at a time, I can allot more time and effort and improve my chance of success.


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photo credit: cygri via photopin cc

2 comments:

  1. Naku.. Guilty as charged ako dyan. Kahit sa work patalon talon ang pag-complete nang task ko. Para akong May adhd. I'm hoping that I could change how I think and work

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    Replies
    1. Yeah, me too. I do it sometimes. But I found that once you are aware, you can usually "stop" it. The longer, you've been doing it, though, the harder it is to stop.

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