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Sunday, October 20, 2013

Mellody Hobson: A Leader in the World of Investing


LEARN FROM GENERALS OF THE MARKETS - PART 38

“If you are truly passionate about trading and hope to be in the game for a long time, I recommend focusing on a slow and steady approach.” – Joseph Fahmy

Mellody Hobson was born in April 3, 1969 (Chicago, Illinois). She’s an American investor, trader and businesswoman. She got her BA from Princeton's Woodrow Wilson School of Public and International Affairs. In addition, she’s bagged honorary PhDs from St. Mary’s College and Howard University.

After receiving her BA, she started working at Ariel Investments, LLC. She began to climb the ladder of success within that company: from being an intern to being a senior V.P. & director of marketing. Finally, she became the firm’s president. This firm, based in Chicago, is one of the largest Afro-American-owned mutual funds and funds management firms in the USA, with over $3,000,000,000 in assets. Mellody is the Chair of the Board of Trustees of Ariel Mutual Funds and Dreamworks Animation SKG, Inc. She’s spread her tentacles into businesses, programs and foundations. She’s been featured in many popular magazines, along with extraordinary achievers like herself. Her corporate website is: Arielinvestments.com.

In the year 2006, she started dating billionaire George Walton Lucas, Jr., American businessman, movies producer and screenwriter. They got married on June 22, 2013.

Lessons
Here are some of the lessons that can be learned from this illustrious black American:

1.      As it’s been said somewhere else, successful trading and investing has nothing to do with one’s color, race, education background, religion, class, gender, country of origin and other discriminatory factors. Consistent survival in financial markets has no borders and can be attained by you.

2.      On the official website of Ariel Investment, there’s something there that piques my interest. There’s a saying there that goes thus: “Slow and steady wins the race.” How important and timeless this trading truth is! Contrary to those who think they can double their account many times in a month or in a quarter or in a year, investing and speculation strategies that work entail very slow, but steady equity increase. In trading, those who sprint too fast like the hare or the horse are bound to crash at last. Trading is an activity that makes us get rich slowly, not quickly. I’ll be happy with 15% profit per annum if my capital is safe. Or what’s the sense in targeting hundreds of percentage of returns per annum while your capital vanishes after a margin call? The tortoise and the snail move slowly, but if you go to sleep, they’ll have moved far when you wake up. What initially looks like a very slow movement translates into a great distance over a long period of the time. 

3.      Mellody advises people that they should forget fear. Many people hate or are afraid to invest their money in the markets because they think they can lose it.  When the markets crash and become too undervalued, that’s when most people would be afraid to buy (and that’s the best time to buy). When the markets rise and rise significantly over a long period of the time, thus becoming very expensive, that’s when most people would want to buy (and that’s the best time to sell). When the market is overbought, people have no fear (and that’s when they should be fearful). When the market is oversold, people are fearful (and that’s when they should be confident). As you can see, people’s investment timing is invariably wrong. They buy when they should be selling and they sell when they should be buying. It’s a pity that people don’t want to sell for profits when the markets are overvalued and dear. Rather, they sell for loss when the markets are undervalued and very cheap. The foregoing is the opposite of what you should be doing in the markets.

Conclusion: In one of his past newsletters, Joe Ross (Tradingeducators.com) said that there’s an old adage which goes thus: "It is better to have loved and lost than to have never loved at all." Joe then continued that similarly, anyone who desires pecuniary freedom had better make attempts and lost money during the initial futile attempts, than to stay in a state of complacency and merely wish he’d made an attempt. Such a person could spend the rest of her/his life feeling bad because he’d failed to utilize the opportunities of a lifetime, for the person would perceive the fact that if she/he had taken steps the dreams could’ve been actualized.

This piece is ended with a quote from Mellody:

“I know many members of our community steer clear of Wall Street because of the perception that the stock market is risky, but I am convinced the biggest risk of all is not taking one.”


Eye-opening trading lessons: Lessons from Expert Traders 

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