Playing the Waiting Game with Investing

I’m not a patient person by nature. However, I do come across to others as a patient person. It’s an interesting dynamic.

On the outside and to those outside my house, I come across as a calm, collected, easy-going guy. But on the inside, I’m like boiling water…constantly moving in thoughts from one to another, thinking of the next objective to tackle, and ready to take action on something. On the inside I’m a fidgety mess, can’t sit still.

Ironically, the impatience and movement is in my head and with my thoughts. My body stays pretty still and resembles a sloth to the outside observer. Just thought I would point out that difference. Crazy action in the head…almost zero action with the body.

I think most of this has come about because of the current information age we live in. We have nearly instant access to almost any information our brains can think up. Thanks Google.

The crazy information age coupled with my endless thoughts leads me to be impatient. I’m not blaming Google, I just need to work to harness the crazy in my head.

Investing and Patience

In most cases, patience is a virtue. With investing, patience is definitely a virtue.

So why am I so impatient lately when it comes to investing?

I’m sitting here obsessing over my financial spreadsheets. That generally leads me to pull up my investing spreadsheet, which has info on my Scottrade stock accounts (taxable and Roth IRA), both stocks and options. I find one metric or one column of data that gets me thinking. It usually leads me to one question, and that question needs to be answered, to soothe the crazy in my head. Come on, we have Google today, why wouldn’t we want the answer to our every question and have it within seconds?

So off I go, diving into some websites, pulling up summary info on individual stocks, or searching a stock for option prices for the next few months. It’s all available to me and I have this new burning question created in my head that needs an answer.

Other times, I am very patient with investing thoughts. But lately it’s all impatience.

Example of the Impatience

Here’s an example of a recent, manic search and analysis I obsessed over.

I subscribe to a newsletter service from The Motley Fool, it’s called Income Investor. I call it a newsletter service, but that’s an old term. Anyway, they provide stock picks for dividend paying companies and in-depth company analysis for a fee. It’s relatively cheap. They provide one buy recommendation per month and you have access to their ongoing analysis of every company they recommend. They are seeking dividends and stock price appreciation with a long-term buy and hold outlook. Ironic that my impatient self subscribes to this very patient service.

So I went looking through the past recommendations, current dividend yields, and potential price appreciations. I was looking for stock picks to fit my current criteria for my Roth IRA.

Now, I currently have zero funds to invest in stock picks for my Roth IRA. I began depositing $25 per week and will have $2,600 added from my rollover IRA soon, but right now, there are no funds to invest. And this search for stocks was before I began moving funds into my Roth.

That didn’t stop me from obsessing over this stuff, though. I was in obsession mode. So I obsessed.

I went looking for stocks that have a dividend yield of 4% or higher, a high potential price appreciation, and companies that are poised to take advantage of changing financial environments going forward. I’m looking for something like oil and gas companies who are getting by with very low oil prices, or bank type companies who are ready for the rise in interest rates, or stable companies who weather any economic environment.

I narrowed it down to a handful of companies and then entered their current info into a spreadsheet…current price, target price, current dividend yield, potential price appreciation percentage. Then I sorted the info by potential price appreciation, looking for the best potential gain first.

Now I have a target list of companies that I can research further. The funny thing is that I’m doing this about a month or two before I have any funds to actually invest in these companies. I guess that’s why they call these things obsessions.

The Good and The Bad

In this case, I was able to use my crazy, obsessive energy for good. I channeled my impatience into action that produced a target list of potential companies to invest in. That’s the good part about this…I can use my obsession to get somewhere.

The bad part is when I let my impatience impact my investing life. I’ve done it before and I’m sure I will do it again. I have opened my stock account and made rash sell trades, thinking that I’m freeing up my funds in case I need them, like some emergency move to make the money available. I remember later that stock investing should never be considered part of an “emergency fund,” but in the moment I wasn’t thinking that way.

So I’m working on focusing my obsessive energy towards the good and minimizing the bad.

What’s Fueling the Obsession?

This latest obsession over financial matters is directly related to my current financial state. Once I took off my blinders and got actively involved in solving our debt crisis, I moved into obsession mode. Been there ever since, but the latest obsession craze is more about control.

Part of the reason I am obsessing over my investments is that it is about the only area of my financial life where I have the most control. With investing, I live and die by the decisions I make, and I’m okay with that because I control those decisions.

With debt, I feel much less in control. Sure I control how I accumulate and when I pay down the debt, but the banks or credit card companies are in the driver’s seat. They control the game, I’m just playing it.

So with investing, I ran to the place where I could exert the most control on my finances. I chose how much to invest, where to invest, and what vehicles to use for investing. Whether any of this is true or not doesn’t matter. The fact that I feel more in control with investing is all that matters.

More Patience Required

I need more patience with my investing. It’s tough but I keep repeating that basic mantra to myself every time I want to go look at my Scottrade account.

“Slow down big guy. Patience. Investing takes time.”

“Wooo saah.”

You know, wooo saah, like the guys from the movie Bad Boys…

All of my investing funds are tied up in trades, waiting on option expirations. I’m a month away from any options to expire where my underlying stock will get called away or I will keep the stock (depending on stock price at expiration for my covered calls).

If the stocks get called away, I have funds available to obsess over my next move. That’s when I can use the fancy targeted stock list I mentioned earlier. If the stocks don’t get called away, I can look to sell another covered call option on them.

I’m not good at the waiting. Everyone say it with me…”Wooo saah.”

What are you impatient about? What do you obsess over? Tell me in the comments.

Follow me on Twitter as well for more obsession infused ramblings.

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  • Mrs. Groovy

    Maybe we can cowrite a new hard-rock song called “Harness the Crazy in My Head”? I know exactly what you’re talking about. Except mine’s not about my investments. I’m amazingly calm about that. No, it’s the little things like – can the world actually come to an end? Investing wise I think we’re much more conservative than you except for a very small amount of play money.

    You gotta take a look at the book “The Laws of Wealth” and also read Carl Richards over at Behavior Gap. Both are about the psychology of investing. No offense meant, but maybe your mind obsesses because you’re taking a lot of risk?

    • I’m in for cowriting a hard rock song, especially if it helps me get the crazy out of my head.

      I am certainly more risk tolerant than most investors, but dividend stocks and covered call options are still very conservative. Going more conservative is index funds or bonds. I think risk is appropriate at certain times, ages, and general tolerance levels. For you, I can certainly see why your investing would be more conservative, heading into retirement and using those funds. I have been more risk tolerant for years and the current strategy has pulled back from other high risk things I’ve attempted.

      I certainly take no offense, you just gave your thoughts…always welcome here. This is how we learn from others. Thanks for the book recommendations, I’ll put them on my list to check out.

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About Brian Stephens

Brian is on a journey from massive debt to real estate mogul. Join him as he stumbles and fails on his way towards long term success. Debt isn't pretty and turning it around won't be either. His primary goal here is to tell the story and network with like minded people who want financial independence through real estate investing.

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