Do our thoughts have a profound impact on our lives? As Marcus Aurelius wisely said,” Your life becomes what you think.” By shifting our mindset, we can ultimately alter our lives.
Thoughts are one of the most powerful tools humans possess, but they can be used to change our lives positively or negatively. Napoleon Hill, in his book Think and Grow Rich, eloquently stated, “Both poverty and riches are the offspring of thought.” Through our thoughts and imagination, we shape the world, continuously forging new ideas and innovations in science and technology.
Do you find that your mind feels restless sometimes and hard to control, especially in the digital age, when you have access to so much information at your fingertips? We are free to conduct as we will but we have to master our choice. Our thoughts are the greatest path to discovery. Approximately 60,000 thoughts go through your brain daily but 75% are negative and 95% are repetitive. It’s important to fill your mind with positive and productive thoughts.
But how do we change our thoughts? All the innovation and advancement of science and engineering in the world once was a thought in our mind. As Marcus Aurelius also stated, “The universe is a change; our life is what our thoughts make it.” We have to be careful what we let into our minds and say no to almost 99% of the things that we encounter daily. Only make investments or choices where we have an unbelievably attractive, asymmetric payoff.
Wolfgang von Goethe said it well, “The encouragement to act boldly comes from the experiences of a man who was extraordinarily bold.” In 1953, Mark R. Sullivan shared his vision at a business conference, predicting the evolution of telephones into personal, watch-like devices enabling users to see each other during calls, and perhaps even translate languages. Sullivan’s foresight into the future of communication, over 70 years ago, illustrates the power of visionary thinking. Sadly, he passed away shortly after the introduction of the first mobile phone.
Yet, our thoughts and ideas must be changed once they serve their purpose. The agricultural revolution favoured those who invested in fertile land, but today’s technological era demands a shift towards investing in tech companies. The rapid advancement of technology, coupled with innovative tools and platforms, allows companies to offer highly personalised experiences.
Tech companies have low costs of incremental production, relative ease of scaling, and the ability to see margins rise as the business expands, rather than suffer diminishing returns. Moreover, the modest need for additional capital and bigger plants as they grow provides them with a competitive advantage to scale and reach global audiences, making them more attractive to investors. Companies that don’t embrace technology run the risk of being obsolete and disrupted in the future.
As investors, we are always bombarded with news headlines about why there will be a recession this year and all sorts of forecasts about the future that no one has the privilege to see. Sadly, these negative headlines attract more readers. As Daniel Kahneman said in his book Thinking Fast and Slow, if you repeat an idea several times, even if it is not true, it makes people more likely to believe the idea and find it credible. The financial media is just doing just that, making simple and memorable stories and then exposing people to them many times because familiarity is not easily distinguished from truth.
Imagine if you listened to them every day what kind of days you would have? One of the most influential and distracting emotions is fear. Sometimes we suffer more in our imagination than in reality therefore it’s important as investors to protect our thoughts from fear and greed and not let the negative headlines stop us from making long-term decisions. Instead, guard your mind with words that are aligned with your goals and desires which in our case make excellent long-term investments.
Awet Ghirmay, Head of Investment Research
If you want to learn more about this topic, please find the link here.
More information about our fund can be found here: Hargreaves Lansdown or AJ Bell
Risk warnings
The value of investments and the income derived from them may fall as well as rise. You may not get back what you invest. This communication is for general information only and is not intended to be individual advice. You are recommended to seek competent professional advice before taking any action. All statements concerning the tax treatment of products and their benefits are based on our understanding of current tax law and HM Revenue and Customs practice. Levels and bases of tax relief are subject to change. This blog is based on my own observations and opinions.
