Which is the single most important trait that characterizes a DIY (do it yourself) investor?
1) I for Individuality
A person who rises above pigheadedness* and understands the steps necessary for wealth creation. However, once the basics are clear (asset allocation is all that is needed!), the person chooses a path defined by personal comfort and expertise.
Once a particular path/style (with a history of performance) is chosen, He/she does not care about what others do, or how others have done it.
It is unfortunate that for most people, volatility in returns is proportional to a vacillating temperament.
*Pigheadedness here refers to an obstinate love for fixed income products (FDs, endowment policies, ULIPS(?!) etc.) without recognizing the associated danger: investment disproportionate to returns.
How does one choose a 'path defined by personal comfort and expertise?'
2) I for Introspection
Questions to be asked first: Where do I stand today? where do I need to go? What do I need for the journey? What route would work for me? How do I reach my destination with minimal fuss?
Questions to avoid: Which is the best investment? What did others do/buy?
Questions to be asked last: Where should I invest? What do I invest in to save tax?
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3) I for Inertia
Static (or bad) Inertia: When nothing moves
Someone who has trouble starting must recognize that personal finance is all about action and must act.
Dynamic (or good) Inertia: When it ain't broke, don't fix it.
Someone who is up and away towards their financial goals must not stop to worry about short-term market movements. If something is chuffing along nicely, let it.
4) I for Inclination
Perhaps should be number one in this list. Action should be fueled by the drive/inclination to change.
5) I for Information
Less is more: Inclination, Introspection and Dynamic Inertia thrive when the investor can distinguish between knowledge and information. A strong individuality helps in this regard.