Chapter 2. Investor Identity Fundamentals: Frames, Motivations, and Goals
This chapter addresses several of the core concepts that underlie an investor identity. This chapter is all about the first steps: the issues to be resolved before investing money, and to be periodically revisited along the way. We explain the frames of reference (frames) most investors carry and discuss techniques for "re-framing" damaging assumptions. We will dig into investing motivations, the often hidden reasons why we invest our money. The chapter goes on to cover the importance of setting goals for investing and understanding our intended destination. (Few people would recommend beginning a journey with no destination, after all.) Unfortunately these investor identity fundamentals are often overlooked by investors, perhaps in their eagerness to "get on with it" and pursue immediate profits. The chapter concludes with several questions to help you clarify that your frames, motivations, and goals are in alignment at the moment of making investment buy and sell decisions.
The Detail-Orientation Test: A Case Study in Frames
A human resources consulting company was looking to hire an administrative assistant for its New York office. The job would require preparing documents, proofreading, billing, and other responsibilities that demand attention to detail. In an effort to ensure hiring a qualified person, the company—whose job it was to help other companies make better hires—created a specially designed test ...