What Is Your Investment Skill Level?

If you seriously want more consistent investment returns then you must first raise your investment skill level. It is simple cause and effect: you won’t get one without the other. Investing is a profession no different than any other profession, and it requires trained skills and a depth of background knowledge to succeed.

Think about it. You wouldn’t perform brain surgery on yourself or file your own lawsuit; yet, for some reason most people think nothing of investing their own money without any particular training or skill. Surprisingly, many people are more comfortable building their own portfolio than building their own house – as if successful investing required less skill then construction. It makes no sense!

I’m a big believer in learning how to invest so that you can run your own portfolio, but that’s only true if you first commit the time to learn how to do it right. There is nothing more dangerous than attempting to manage a million dollar portfolio with a thousand dollars worth of financial intelligence. That is why I became a financial coach – to help people with that training. It is a skill that will pay you dividends for a lifetime. It is well worth the effort in my completely biased opinion.

What I have found in coaching many people just like you to become successful investors is your learning will follow a predictable progression no different than the progression you followed in developing the skills for your current career. This progression of skill development is identical to the pattern my children follow as they learn to ride a bike or swim: there is nothing surprising about it – it is a completely predictable process:

Unconscious incompetence is where everyone begins. You don’t even know enough to know what you don’t know.
Conscious incompetence is the second stage, yet it is where most people stop their training. You learn conventional ”retail investing knowledge” and begin traditional passive investing. It’s a fine starting point, but it won’t produce consistent investment profits – as too many people are unfortunately learning right now.
Conscious competence begins as you learn to integrate risk management into an investment discipline. At this stage you typically begin employing a variety of investment strategies to profit from varying market conditions creating more consistent returns.
Unconscious competence is the final stage of skill development that occurs when you understand your investment strategies so well that investing becomes more of an administrative task than a creative endeavor. You no longer use traditional media for investment information, but you do use it to understand what the masses are paying attention to. You can continue to learn and advance your skills but you can never go beyond unconscious competence – you just go deeper into it.

I just published a new article explaining these four levels of investing. It provides much greater detail about each level so that you can identify where you currently stand. The reason you should care is because each stage of progression provides the opportunity for more consistent profits and greater financial security.There is a clear benefit to growing your investment knowledge and skill to the next level. That is why the tag line for our blog posts reads “We build your financial intelligence so you can build your wealth” – one leads to the other like cause leads to effect.

You can read the full article here, and please let me know your thoughts in the comments section below…