I am writing this column a day before Thanksgiving. It’s hard not to do one of those sappy, “What am I thankful for?” pieces.
Because it is hard not to, I have decided to write one.
I am thankful that my dad pushed me in the right direction when he suggested I look into what it might take to be a stockbroker back in 1985. Since then, I have evolved from stockbroker to adviser to the owner of my own advisory business, and have grown to love this profession.
There are many things that he has taught me that have served me well in my profession, but three always seems to be the magic number when writing, so I’ll keep it at three.
• First, he taught me to always look at the big picture. People get caught up in what is happening to them at the moment and tend to forget how that might fit into their big picture.
In the investment world we see it all the time. Investors get personal with one investment and forget about how it fits into the whole portfolio. Holding on to an investment too long because it has been good to you or waiting for a bad investment to come back up so you don’t have to take a loss are bad moves when they affect your overall plan in a negative way.
Always do what is right for the big plan.
• Second, dad told me to remember that “terms are more important than price.”
This is a big one that I see people get wrong a lot. Investors get caught up in the price of an investment and forget about the true underlying value. Price only is important in its relationship to the true value of an investment.
It doesn’t matter what other people paid for it. It doesn’t matter what you paid for it. It simply matters that the price is either going to be higher than the underlying value or lower. If it is lower, you should consider buying it. If it is higher, you should consider selling it. The price per share on its own really means nothing.
• Third, he has always told me, “Don’t forget where I came from.”
Now, he may mean that I came from him, but he is a bigger-picture guy than that. I think he means that everything we do in our lives builds on itself to create a reputation and that reputation can build trust and loyalty or it can do the opposite.
So, everything you do matters. For me, having a mission statement that states what I believe has been a huge benefit when trying to make tough decisions. It has kept me on track far more times than I can remember. It can help you, too.
Maybe I will write this column long enough to thank everyone that has helped me, but for this year, I thank my dad.
And any of you who may have been helped by what I write might want to thank him, too.
Scott Reed is CEO of investment advisory firm Hardy Reed in Tupelo. Contact him at (662) 823-4722 or firstname.lastname@example.org.