Daniel Kahneman: Owning Stocks
on Friday, July 2, 2021Daniel Kahneman Money Quote saying long-term investing requires ignoring short-term losses or it can make you miserable. Daniel Kahneman said:
“If owning stocks is a long-term project for you, following their changes constantly is a very, very bad idea. It’s the worst possible thing you can do, because people are so sensitive to short-term losses. If you count your money every day, you’ll be miserable” — Daniel Kahneman
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In this quote, Nobel Prize-winning psychologist Daniel Kahneman is offering advice on investing in stocks for the long run. He suggests that if owning stocks is a long-term goal, constantly checking their fluctuating prices in the short term will only cause misery, as people tend to fixate on and be overly sensitive to temporary losses.
Kahneman implies this type of frequent monitoring is psychologically unhealthy and counterproductive to the patient, big-picture approach required for successful long-term investment.
His message conveys that investing should be viewed as a marathon, not a series of sprints, and daily price swings should not distract from the long-term trend if one’s time horizon is measured in years rather than days or months.
Birthday: March 5, 1934 – Death: March 27, 2024