For the average person, the idea of starting to invest is overwhelming. But in financial expert Katherine Collin’s new book, “The Nature of Investing,” it sounds so easy that an insect could do it. In fact, investing skills are used in nature all the time. Here, we outline some need-to-know facts about this new, simpler way of thinking.
The basic idea
“[Beginning investors] tend to get weighed down by financial jargon, but investing is really something we do every day without realizing it,” Collins tells us. “Every time you make a decision, it’s an investment of some sort, whether it’s your time, money or energy.” Rooted in this way of thinking, Collins advises investors to live by the principle of biomimicry, which is asking yourself, what would nature do? “Just asking yourself that question brings really surprising insights and answers start popping up right away that can lead you on a path to really healthy decision making around your finances,” she says.
How it works for investors at every level
Collins claims that biomimicry doesn’t just work for beginning investors, but reaches across the playing field so experts can use it as their guiding force as well. “Professional investors have told me [biomimicry] has reminded them of the essential questions and functions of what they do every day,” she says.
Collins started working as a junior analyst at Fidelity 20 years ago and says at the time, investing was more personal: “The mindset was, if you’re buying a stock, you’re buying a piece of the company and you should understand that company and why it’s worthwhile and how it can benefit our shareholders. Now, it’s about starting with a data-stream and then maybe, if you’re lucky, you work backwards and find out what that data means in the world. I just want to remind people what investing really is. The rest of that stuff is just trading, and often speculation.”
Challenges to watch out for
If you’re like most and have been conditioned to solve any problem that you’re presented with, Collins says the hardest part about biomimicry is being patient and observing what is happening before taking action. “Just know that it’s not wasted time. It’s time you’re spending taking things in,” she says. Then you can make smart, actionable decisions.