Risk is about an uncertain outcome. When one has taken a risk and been rewarded, we tend to believe there was no risk at all.
This leads to overconfidence in one’s abilities, which then leads to the search for even more risks. One tends to start looking at something that nobody is looking at – the spirit of adventure in us wants to seize the opportunity. And we leave the shores and dive into the deep seas.
From bluechips to mid-caps to penny stocks; or from downtown to suburbs to rural real estate; or from mutual funds to listed stocks to private equity – the journey to the darker alleys starts. If we have knowledge and expertise, it is ok to venture into these areas. Without that, it is dangerous.
#RidingTheRollerCoaster – 73