Fear Creates Opportunity

Oct 15, 2020

Is this the best time to invest? Or should you be hiding out in a bunker with your money?

Many people out there are scared. Mostly about their finances and what the best money moves are to make now. They are afraid of making mistakes. Yet, doing nothing is often the biggest mistake of all. 

Don’t just take my word for it, take a look at what some pretty famous people and legendary investors have said about fear and investing, and what you need to do in times like these. 

“Offensive operations, oftentimes, is the surest, if not the only means of defense.” – George Washington

The basis of this quote goes all the way back to Sun Tzu, who is regarded as the best strategist in human history. The best defense is a good offense.

You can’t score or win unless you are taking shots. If you just curl up in the fetal position you’re probably still going to take a good beating.

When it comes to investing you can curl up and watch your money depleted until you have nothing left to invest with. Or you can make moves that will create new income streams and protect and grow your capital. 

“Be fearful when others are greedy. Be greedy when others are fearful.” – Warren Buffett

I’m not sure about the “greedy” terminology, but Warren has built his wealth and survived many twists and turns by buying investments when others are scared. In fact, the time you should be scared is when others aren’t. 

Baron Rothschild put it as “Buy when there's blood in the streets, even if the blood is your own.”

So, even if you’ve recently lost money in investments like the stock market or bitcoin, or tech startups, this is the most critical and beneficial time to invest. 

Billionaire Sam Zell is famous for both his contrarian investing stance, and making billions by buying and investing in distressed debt and assets when markets have appeared at their worst and most uncertain. 

“The intelligent investor is a realist who sells to optimists and buys from pessimists.” – Benjamin Graham

Graham was Warren Buffett’s mentor. He is well known for his stance on dollar cost averaging – meaning to consistently invest through good and bad times. He also clearly favors buying when others are fearful.

Thankfully there is plenty of fear out there today. That means great buying opportunities. The smart money is still making billions in this market. Perhaps at a far faster pace than over the past decade. So, if the above quotes still haven’t convinced you and given you all the courage you need to make the right financial moves, how can you be confident in moving forward?

  1. Follow the proven investing principles that have been tried and tested for years
  2. Continue investing, especially when there is fear out there
  3. Invest with those who’ve been through market turns like this before
  4. Diversify
  5. Invest in outsized reward versus risk opportunities

Investment Opportunities

Find out more about investing in secured debt and real estate, go to NNG Capital Fund

Image by Photo Mix from Pixabay