Читать книгу Psychological Analysis - Adam Sarhan - Страница 13

Capital comes in two forms: smart money and dumb money. The decisions people make regarding how they manage, invest, and spend their money determine whether they are in the “smart money circle” or the “dumb money circle.” Don't worry where you were yesterday; the key is to focus on where you want to be today and to set yourself up for a better tomorrow. Nearly everyone starts off in the dumb money circle and, sadly, most stay there forever. I'm here to change that. Over time, I've learned how to stop making dumb money mistakes, I've entered the smart money circle, and now I find tremendous joy in helping other people enjoy financial freedom and do the same thing.

Cash flows in and out of the market all day long. The same is true for cash flowing in and out of your pocket. Before I go any further, it is important that you know that there are an infinite number of ways for people to make money in capital markets, and you just have to find one that works for you and your personality.

Regardless of your approach, it boils down to one thing: successful people, people in the smart money circle, consistently take money out of the market, while unsuccessful people, those in the dumb money circle, consistently put money into the market. By the time you finish reading this book, you will learn how to join the smart money circle and consistently take more out of the market than you put in. Plus, you will learn my strategy and how you can build your own successful strategy for beating the market.

Perhaps the most important thing that will allow you to consistently make big money, achieve financial freedom, and join the smart money circle is to learn how to make great decisions—objective decisions based on information, not emotions—especially when you are under pressure. Everyone makes decisions, but making great decisions is what separates those in the smart money circle from everyone else.

I have been studying “smart money” since the 1990s, and I've managed to transform my life by moving from the dumb money circle into the smart money circle. People don't get rich by accident, just as athletes don't win championships by mistake. It's not a fluke that Michael Jordan was number one in basketball or that Tom Brady was number one in football: they both were relentless, they both made sacrifices, and they both put in the work necessary to rise to the top of their games. Likewise, it's not a fluke that Warren Buffett, William O'Neil, Paul Tudor Jones, Stanley Druckenmiller, David Tepper, and countless others have amazing track records and win on Wall Street decade after decade: just like elite athletes, they all make the sacrifices and put in the work necessary to become legends in their chosen profession.

In sports, you must have a certain physique to win. If someone is 5′4″, they're at a tremendous disadvantage if they play Michael Jordan in a game of one‐on‐one—but in the market, anyone can compete and win if they are willing to put in the work. Investing your money and placing thousands of trades over several decades is largely a mental sport, not a physical one. Success in this business is the result of your thoughts, decisions, and, most importantly, your actions. In order to win, you must bring out your smart money superhero (the best version of yourself) and defeat your dumb money beast (the emotional, lazy, and unproductive version of yourself).