The Avatar: What Kind of Emotional Investor Are You?

Understanding your avatar is crucial to having a successful portfolio and more!

Posted May 15, 2018

Most of us dismiss those “What kind of such-and-such are you?” surveys as trivial wastes of time. But there’s actually a lot of value in evaluating your own personality. Although it might seem cliché, when it comes to investing, self-awareness about one’s personality and emotional intelligence (EQ) plays a critical role in determining one’s financial success—or failure.

The manifestation of an individual’s EQ is an underlying representation of their belief system. People strive to bring certain things to life based on their hopes and dreams. They also make financial decisions according to these aspirations. It’s the “why” behind what we do in life, whether we recognize it or not.

To understand how EQ impacts investing strategy and behavior, it’s imperative to comprehend the physical manifestations of our beliefs about decision making. This is best understood through the seven EQ investor “avatars,” each with unique behavior and personality traits.

What kind of Emotional Investor are you? And how does that impact your investment behavior? Read on to find out:

The Giver

Givers live to give to others. They contribute however they can to the greater good. Although they don’t need to be the initiator of a cause, nor be in the spotlight, they relish participating in a cause and offering service.

Givers become energized when they contribute, give money to charity, or invest in ethical or sustainable portfolios. If your engine gets revved up when you add value to others and you feel like you’re making a difference, then you may be a Giver.

However, one thing that Givers need to be aware of is to not give too much. You don’t want to put yourself in financial straits or impact your ability to give in the future.

The Connector

Connectors strive to build relationships and bonds, and these ties are always based in trust. Connectors are educated as an expert in a particular subject and work hard to demonstrate their expertise as a way of establishing trust.

In general, Connectors invest based on the deep bonds and connections they have with friends, family, colleagues, and their investment professionals. They invest based on achieving financial goals to improve family bonds. They also prefer to seek out a financial advisor who feels like “part of the family.”

While Connectors feel empowered as they strengthen trusted bonds, it’s important to balance that with an objective, rational approach.

The Problem Solver

Problem Solvers have an uncanny ability to observe their surroundings and absorb data. They process information, circumstances, and happenings at warp speed (in other words, almost automatically) and without conscious thought.

If you’re a Problem Solver, then you love to pore over stock charts, 10-K reports, and market data to formulate an investing strategy. To you, investing is a fun, complex, challenging problem to solve, and you eventually come up with step-by-step procedures and solutions to tackle your portfolio.

A Problem Solver’s energy meter goes up when tackling the complexities of the market. At the same time, they do have to remember that the market is unpredictable, and that not every financial downturn can be managed with formulas and spreadsheets.

The Innovator

Innovators love to invent things. They associate concepts from disparate disciplines or industries, and apply those to their portfolio or investing approach. Tinkering with ideas comes naturally. Innovators look at problems or processes and think, “How can I try something new or completely different that might yield big returns?” Innovators are among the first to adopt things like quant investing and ETFs.

It goes without saying that the Innovator stands a better chance of hitting a homerun with the next big tech stock. The downside is that they need to manage risk. Reality dictates that the “next big idea” in the investment world seldom pans out.

The Perfectionist

Perfectionists believe there is a “correct” way to do things at all times. They seek out effective systems and don’t cut corners or skimp on the details. They follow procedures and are results-driven. Perfectionists set goals for their return on investment over time, or benchmark themselves against the market, and relentlessly dedicate themselves to meeting those goals. They’re process-oriented, take meticulous notes, and are driven by effectiveness and competence.

Perfectionists make successful investors, although they must guard against the tendency to micromanage portfolios or beat themselves up if things don’t go as planned. They need to recognize what they can control and not fret about the rest.

The Rebel

Rebels live outside the box and buck against the typical or classical way of doing things. They challenge the status quo and seek unique solutions that no one else has considered. Rebels are often entrepreneurial and love disruption, particularly if it is a game changer.

Similar to the Innovator, rebels are willing to consider the new, the exciting, and often the misunderstood. Ten years ago, Rebel investors may have been called crazy for investing in Bitcoin. They gravitate to anything offbeat, divergent, or just plain “weird.”

Rebels are usually first to invest in the trends of the future, yet often need to have their out of the box investments curtailed as part of a more sustainable, sensible overall investment strategy.

The Master

Masters seek deep amounts of information over a broad variety of investing topics. They educate themselves on investing for the sheer joy of curiosity and ingesting something new. Masters take online classes on investing, read books, and go to seminars. They look at investing and portfolio management as a skill or craft that they hone over time.

The results of their portfolio performance are a reflection of the intellectual capital they pour into it. But much like the Perfectionist, Masters need to bear in mind that not everything is a reflection of one’s performance. Market downturns happen, no matter how good you may think you are.

Why your avatar matters

Keep in mind that there is no “best” EQ avatar, only pros and cons to each one. What’s important is your self-awareness about your personality traits and tendencies. By being in touch with your EQ avatar, you can work with yourself, your partner, and your financial professional to tailor the best portfolio and investing strategies for your emotional personality type.

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