 Good day, fellow investors. I firmly believe that investing is, of course, first about research, knowing all the accounting, all that's going on, following and everything, but everybody can get to that. You have data, you have everything, everything is public today on the internet. The key then comes to the mindset and Benjamin Graham said that the biggest enemy of each investor is himself. So it's crucial to develop a correct investing mindset so that you can take advantage of what's going on, increase your long-term returns and today I will share with you 10 mindset tools that you can use that give you an advantage over Wall Street. Wall Street is, like the majority of people, very short-term oriented and therefore if you have a long-term orientation, a business orientation, if you're calm, if you're ready to buy into panic and sell into exuberance, you might do very, very well for you and eliminate all the fuss, all the hysteria, all the rationality that Wall Street is always offering. You just need to turn on the news and it will be always short-term panic and always about something new. We have the trade wars now. We had the Fed interest rates a year ago, always something who talks about North Korea anymore but two years ago it shaked the markets. So just follow these 10 principles and of course the channel if you like them. So please subscribe if you like this mindset style investing and then you will do well over time. Let's start. Number one, focus on the absolute business return. So when you buy, let's say you buy a house to let it out and then you say okay I pay 100,000, the yearly rent is 6,000, my business return is after costs and everything, 6%. And then you see okay if I'm happy with that business return, okay that's it. You're happy with what the business delivers and the same should be applied to stock market investing. You're buying businesses not stocks. If a stock goes up or if that piece of real estate goes up the better but those are always free options that you have to buy. What you have to buy always is the business and then if it explodes free bagger, four bagger that should be inserted into the price for free. If you focus on buying businesses as an owner then you have a great advantage on Wall Street. If you look at Wall Street and their analysis they are always comparing to other companies so they are not absolute investments. They are relative investors because they compare to everything else and then they always give an outlook two quarters ahead. What will happen? This will hit their earnings in the next two quarters. Who cares? You have to care where will their earnings be in the next 10 years and then put that into an absolute personal perspective. Number two, think like an owner. So I buy businesses, hold the business, I feel like I own the business. A few days ago we discussed gas prom, okay I feel like I'm not owning the stock. I own the pipeline, the power of Siberia that goes directly into China where they'll start pumping gas in December. That's what I own. However it's boring to own a pipeline. Nothing happens, perhaps a fire here and there hopefully not. But you just own businesses, you accumulate them over the long term like Buffett did. He accumulated the American Express Geico and he just holds that let's it compound over the long term. Grow, grow, grow and that's it. There is no excitement and I know that I would have my current business short-term would be 10 times bigger if I would talk about Tesla, if I would talk about trading short-term gains, neostocks, even on the stocks I cover if I would say oh gas prom will go up another 20% in the next three months I think I would be at 200,000 subscribers. But I'm an owner and I know that long-term ownership beats stock market trading and that's a proven thing. Number three so much used, even over views but there is a difference between saying it and feeling it. Be greedy when others are fearful and be fearful when others are greedy. Tesla stock I have seen the greed over the last two years, three years everybody was oh yes it will revolutionize everything ever. And now I see that greed turning into panic and you have seen what has happened to the stock. Now it's a much better investment I'm not saying it's good or anything I'm not covering it but it's a much better investment now that people that it is much lower than it was six, seven months ago when it was closer to 400 from an investing perspective. However trading it's always excited something happens and unfortunately few do what has to be done which is you buy Tesla now if you're an investor not six months ago when it was at 400 with a huge market capitalization which leads to the following number and that is hyperbolic discounting. Hyperbolic discounting is a behavior finance concept where people prefer small and soon rather than bigger and later. As people as normal human nature is you want something now and you want it immediately everybody your mind is then happy. It's very hard to postpone to delay gratification even if the gratification in the future will be much much bigger than what you get now which might be very very small. So most people sold gets from after it went up 20-25% later the company went even higher so you miss on a lot if you focus on the short term if you focus on the long term there is where the five ten baggers the Peter Lynch investments develop and this is something you have to take advantage because you see okay Wall Street focuses on the year two years max if you start focusing on the 10 years what will the world look like in 10 years then and forget about the short term volatility rationality then you really have an advantage over Wall Street and that's the key hyperbolic discounting also discussed in Seth Clariman's book the margin of safety and I really so few thinking about how the world will look like in three five ten years everybody's focused on what will the next trade tariff increase do instead of focusing what will the world look like in ten years when you focus on that everything becomes much easier and you have a great advantage because ten years will pass like this consequently anything can happen in the stock market but it's much easier if you focus on risk I love Tesla for example I love the mindset I love the craziness I love the changing the world mentality but as an investor I simply focus on risk I know the company is on shaky financial legs can go bankrupt if they don't hit their targets if the capital markets say I'm not going to give them you give you any more money they can burn their cash very quickly consumer cars it's based on consumer preferences which can change very fast we have seen Teslas around already for six years now so people might want to take something new which might hit the company so when you focus on risk first focus okay what's the worst that can happen and can I take it it's again something that makes investing much much easier you miss on a lot of companies that shoot up but when you compare it from a risk reward perspective then you see okay I missed that but I knew why I missed that and that makes your investing focused on low risk high return investment so you try okay there is a margin of safety there is a limit to what you can lose and that makes investing again easier over the long term and you have again an advantage because you know what is risk and reward what does it mean risk risk doesn't mean the stock cannot go lower that's absolutely impossible to predict any stock at any point in time can fall 70 percent and it will fall three times in your lifetime each asset class will fall 70 percent in value that you own the question is okay what's the margin of safety margin of safety doesn't mean the stock will not go lower it means that you have a long term value that will eventually bring it back to that level or deliver the returns you are hoping for it can be I don't know an asset a big building that is very valuable land feels a good ore body for a mine or something like that so those are the margins of safety something that will produce value for eternity and that's something you have to focus on the stock price will always be volatile but the value is usually very very stable so that's again something you can take as an advantage over the rest of the market and then something very interesting people prefer linearity you need okay my portfolio hopefully will increase five percent per year and that's again something that will not happen like that everybody knew Gazprom will eventually increase the dividend but the stock slowly was really lingering lingering lingering and then it exploded only when the news actually happened only when things started to happen so in the markets nothing will ever be linear and that's something you really have to keep in mind to avoid focusing on the short term volatility know that things are not linear but as long as the fundamentals develop in a relatively stable way grow grow and build on that then you are okay and then you'll find the stock price explode when the market gets recognizes what's going on another big advantage you can have you can have a percentage of portfolio in cash depending on what's going on in the market 98% of portfolio management's professional portfolio managers have to be 98% of 95% invested at all times because it's their job to be invested in stocks so they have to be invested only Buffett said Claremont can have a cash allocation as large as they wish for to wait for those opportunities and the best thing is to have a strategy okay I am investing when I find an investment that gives me a risk reward return of five percent if you are happy with five percent seven ten fifteen percent which is my threshold so I have said I'll be 80% invested when I can find investments of 50 deliver 50% 90% investment when I can find 20% business returns over the long term 100% when I can find 25 margin investment to 120% when I can find 30 and plus risk reward adjusted investments so for now I'm around 75% still looking but the portfolio is on strong grounds I think and over the long term will deliver me my 15% if some stock falls due to trade wars due to irrationalities I will buy more of that and then when it goes up again when it hits the 15% let's say from a 20 to a 15% return I'll sell it and then balance my portfolio with the cash I have which is something very few investors professional investors can do so to summarize with number 10 really look at what has been going on in the markets over the long term and do the opposite of what most investors and consequently wall street does because wall street caters to long term to most investors and not too long term investors if you just look at jp morgan's chart your investment returns over the last 20 years you can see that asset classes did okay in relation to asset classes we'll discuss reads in the following videos that were the best performing asset class but the average investor made just what less than 2% over the last 20 years because they buy inexuberance they sell in panic and they miss out on the whole market developments so just think okay if my neighbor is doing this how smart he is is he under the influence of crowd of herding of everything and what are the real basis margin of safety risk business return focus on absolute returns absolute business returns and when you build a portfolio on those basis on those strongholds you will do very very well over time we are going to continue to build this channel on those fundamentals on those things that have delivered great returns for the last 100 years as value investment has shown that it beats other investment strategies it's just a factor of mindset and you have to see whether you want to learn want to develop that mindset if you wish to do so please subscribe to this channel i'm looking forward to your comments thank you for watching and i'll see you in the next video