When you are out there dating, it’s easy to get caught in a rut and to continue to date the same kind of person again and again because it feels familiar and comfortable. However, sometimes playing it safe does not produce the results that you really want, results that will yield you the best person, the person with whom you can spend your life.
Similarly, when you are investing in your stock portfolio, you may choose to play it safe and stay in the same stocks for a long time, even if they aren’t performing that well because you know those stocks and they feel safe. Or you might have such a diversified portfolio that you never take the time to know very much about any one stock in particular. In investing just as in dating, a lot of people are not comfortable with the idea of changing their portfolio because the unknown is risky, even though it might produce stronger results in the long term.
So, how do you know if you should stick with what you know or take a risk and diversify? And if you do diversify, how should you go about doing it? Let me give you some advice on how to make that decision…
- Evaluate your current dating situation just like you would evaluate your current stock portfolio. If your portfolio has one stock in it, your significant other, you need to decide if it’s time to make a commitment, just to him or her or if it’s time to play the field, invest in some other stocks and see if those stocks yield better results for you.
- Think about your long term goals when it comes to having a relationship in the same way as you would when you are deciding how to invest. Are you looking for marriage or a long-term hold? Or are you looking to date a lot of people until you find the right person much like you would invest in a lot of stocks and see which one pops? Either approach is fine, but you need to be clear as to what you are actually looking to accomplish.
- Ask someone else to help you evaluate your dating circumstances just like you would find a trained advisor to help you evaluate your stock portfolio. Find someone who has an objective eye, but at the same time, knows your personal goals. Let him or her give you his or her opinion as to why you should maintain your portfolio as it is, or get out there and try to meet someone new.
- Educate yourself on what kind of people you could potentially date just like you would educate yourself on the kind of stocks in which you could invest. If you have always focused on blue chip stocks, perhaps it’s time to think about a small cap stock now, i.e., maybe it’s time to try dating someone different from your norm. Is the type of person you always choose working for you? Perhaps if you changed your type a bit, you would find a better connection.
- Be proactive about letting people know that you are trying to meet new people just like you would let people know if you are looking to invest in new stocks. Go to people in your life like your friends, family and colleagues as trusted confidants and let them suggest some new leads.
- If you already have a diversified portfolio and you are out there playing the field, spend some time evaluating each and every person you are currently dating just like you would evaluate every stock you have in your portfolio. Are you carrying any dead weight, meaning that “stock” is not performing for you at all and perhaps you are just wasting your time? Or is there any one stock that really outshines all the rest and perhaps it’s time to focus on him or her more exclusively?
- Think about who you are dating currently and why he or she is really in your life just like you would consider why stocks are in your portfolios. Are you staying with someone because you are scared to be alone or because you are scared of the unknown or are you staying with someone because he or she is the right one for you and you are just hesitating to make a full-blown commitment.
-Find different ways to meet new people just like you would find different ways to hear about new stocks. Perhaps you can accept an invitation to an event or party where there will be a different crowd just like maybe you would read different research materials to uncover something different in which to invest.
