Investing is a strategy game. There are a lot of factors that come into play to make sure that you get the maximum profit and returns. In this blog post, we will give the lowdown on what “Slobs” and “Bliss” are and how exactly they differ in their investment strategy.
It has been proven time and again that a disciplined and regimented individual will outperform their more laid-back counterpart when it comes to making money in the stock market. A recent study by two business professors at Yale University backs this assertion up, showing that individuals who are Slobs Over Bliss (SOBs) in their investment strategy generate significantly lower returns than those who take a more rigid and unyielding stance with their money.
The study, which was published in the Harvard Business Review, looked at the investment portfolios of over 1,000 individuals over a period of 20 years. The researchers found that the average return for those who were classified as Slobs was just 3.7%, compared to the Blissful group who saw an average return of 5.4%. When it came to risk-adjusted returns, the Slobs fared even worse, coming in at 2.6% while the Blissful group generated 4.1%.
So what exactly is a Slob? According to the study authors, Slobs are investors who “Hold on to their losing stocks too long and sell their winners too soon.” They also tend to trade more frequently than their Blissful counterparts, which incurs more costs and reduces overall returns.
If you’re looking to improve your investment results, it might be time to take a leaf out of the Slobs’ book and adopt a more disciplined and focused approach. After all, investing is all about strategy.
Do you want to learn more? Check out Achievable’s FINRA SIE exam prep course to get started today!