Dinah Wolf: how to guarantee a lifetime of successful investing

With students finally back at university and hitting the books (and the bars) hard again, our Gen Z columnist and final-year finance student has some wise words for aspiring investors.

Where it all began…

My very first exposure to investment literature was through a book called: You Say Tomayto: Contrarian Investing in Bitesize Pieces written by the witty Alastair Mundy. For years, this gem sat on our coffee table at home gathering dust. But its catchy title grabbed my attention, so I dived right in. Yes, I totally judged this book by its cover, but boy am I glad I did!

At the time, I hadn’t the foggiest idea what a contrarian investor was, but needless to say I’ve been somewhat of a contrarian ever since. There is something to be said for not following the crowd and having the courage to make your own decisions. Or, as Warren Buffett likes to put it: “Be fearful when others are greedy and be greedy when others are fearful”.

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I grew up in a household where money was openly discussed. From a young age, my parents exposed me to what I like to call the four financial pillars: investing, taxes, debt and budgeting. Looking back now, I realise how lucky I was since many people view money as a forbidden subject, a taboo of sorts.

But it’s time we normalise money talk since the first step to becoming an investor is to be comfortable with money.

Our past plays a huge role in our attitudes (and expectations) towards it. So, understanding this and getting to grips with what money means to you will give you solid foundations on which to build a lifetime of successful investing. To really enjoy the game (and to ace it), the joy of making money needs to be far greater than the pain of losing it. I know, pretty hard to muster. But it’ll be well worth it in the end.

Investing is a journey; one that will humble you beyond belief because, however certain you are on a particular thesis, stock markets are unpredictable creatures that will never stop surprising you. Oh, and (for the most part) they’re not a stickler for rules of thumb. They march to the beat of their own drum.

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Patience and consistency are how you’ll outperform. The less you do (avoid fiddling and tiny tinkering), the better you’ll become. Our brains have a hard time getting to grips with this phenomenon since we’re programmed to think that more ‘doing’ will yield better results. But this couldn’t be further from the truth.

History tells us that, in the long run, stock markets go up. All the major indices have delivered incredible gains over decades and have recovered from major setbacks such as the financial crisis and Covid pandemic. It’s in the short term where those nasty blips occur that rattle (almost) everyone’s cages. Instead of hitting panic mode, fasten your seatbelt and hold on a little tighter. Investing is a long game and, by cutting through the noise, you’ll be on the road to success.

To all the budding investors out there, my message is this: do not be afraid of failure.

When we’re young we have time on our side - we have the luxury of being able to make mistakes without bruising our fortunes too badly. The best lessons (and the ones that will stick with you forever) are the ones learnt from failing. So, go out there and make a few mistakes. You’ll learn a thing or two. And it’ll be worth its weight in gold.