Amrita, during her graduation days had read a book, which centered on the life and struggles of a girl from Istanbul, who is also a single mother. The book very beautifully portrayed not just the life of this girl but also personified the history and culture of Istanbul, the chronic tiff between Turks and Armenians, and the Armenian genocide. Amrita was so fascinated with this piece of fiction, that since then, she has always wanted to visit Istanbul, to feel those dingy lanes of the city, the mesmerizing view of the rising sun behind those picturesque mosques, travel in the local ferry and ingest the cool breeze of the sea.

Now years later, Amrita and her husband are planning for their first foreign trip. When Amrita browses among the blogs and videos for places, somehow Istanbul falls in place, it fits into all the parameters they have set.

This is an example of Confirmation Bias. You tend to find and support the information that you already believe in, while ignoring the rest, to strengthen your conviction.

We all are possessed with biases and we are looking for published material/people/videos/ to confirm our biases. And this analogy extends to investing too. You must have come across many investors trapped under the Confirmation Bias spell. Once an investor has developed a conviction in a particular stock or investment idea, he tends to research for material on that stock/idea and pick information that is in alignment with his belief, and generally gives himself a go ahead.

While it is okay to pick a restaurant or travel a country based on our pre-conceived notions, but in investing, the bias will affect the investor financially. An investing decision based on the investor's beliefs can make him lose money.

So, how do you extricate him out of the mental trap:

> Convey to the investor that he is being biased. Although when the investor is firm in his mind, there are chances that the information you hand out to him may not easily penetrate the bias wall. But it is essential for them to look at the other side of the coin too, so you have to show them the mirror, that bias exists. Narrate anecdotes, your own stories, like the one above, that how we tend to be biased for our case and look at only that material which is in line with our viewpoints. Share stories of investors who kept imbibing the confirmatory information, and took investment decisions that didn't go well in the end.

> Ask them to look for information which contradicts their belief. Say for instance, your client has heard from somewhere that the gala time for IT sector is over, and from now the stock prices of IT companies are likely to move in the reverse direction. Your investor has researched for more information on the internet and newspapers, all news and blogs he read are confirming to his opinion. So, now he wants to sell all the IT stocks in his portfolio and an IT sector Mutual Fund which he purchased years back. This investor is clearly under the confirmation bias trap. Urge him to specifically research for news or articles on the bright future prospects of IT sector. This activity will help them realize that there is another perspective that exists, and he should gauge the appropriateness of the alternate prospect too. Alternate opinions will let him look at the broader picture and take an informed investing decision.

Confirmation Bias influences our everyday decisions. A prejudice for a Pasta Arrabiata will lead us to zero down to it after scrutinizing a 10 pager menu, boasting of a 100 delicacies. But this bias should not extend to investing. While researching before investing is a sensible thing to do, but this research should be done from a neutral mindset. The investing decision making activity must be free from all sorts of behavioral biases. Don't let your clients' preconceived ideas and opinions clout their judgment and affect their investing decisions.

Intelligence is a word that people love when added to their name. It is a common belief that a person with high IQ is likely to succeed in all endeavors of his/her life.

But, when it comes to investing, a high Intelligence Quotient (IQ) is no guarantee of investment success. One of the biggest misconception people have about investing is that only one with a considerably high IQ can pick out the successful stocks and earn big money through investing. However, in reality, intelligence might not be the most important foretelling factors of investment success.

Even Warren Buffett, one of the world’s most influential and successful investor, said "Investing is not a game where the guy with the 160 IQ beats the guy with 130 IQ."

What if I tell you, Mr. X bought stock of Y company @180 and exits the stock @360, booking a 100% profit. But just months later, as the market rocketed up and seeing his friends becoming rich, Mr. X re-enters the stock @680 and exits the stock @175 when it crashed. You might say - Ha! the guy must not be smart or perhaps not well informed.

But, you will be astonished to know that Mr. X was Sir Isaac Newton, the greatest mathematician and scientist of his time.

He was a conservative investor most of his life. Yet, in 1720 when the london stock market started booming he got caught up in the South Sea Company stock market mania and lost half of his life’s savings. A man who calculated logarithms to 50 places had failed to do the math.

Albert Einstein, one of the greatest scientist, invested almost his entire prize money from the 1921 nobel award in the stock markets. However, he lost a bulk of it when the markets crashed in 1929.

Einstein and Newton, both were brilliant and numbers were their lifelines; all their scientific calculations were based on time risk and mathematics. Yet, none of this worked in their favour when it came to the investment in stock markets.

If high intelligence was the key to successful investing, top business school professors and economists would be the wealthiest guys on the planet.

Financial trading offers a perfect example of how conventional measures of intelligence are irrelevant to success. The market does not care where you went to college. It does not care what your grades were in statistics class. It does not care about the valuable connections you made in business school.

Then, what's the recipe for investment success?

Warren Buffett, said: “To invest successfully does not require a stratospheric IQ. What’s needed is a sound intellectual framework for making decisions and the ability to keep emotions from corroding the framework.”

According to Michael Batnick, director of research at Ritholtz Wealth Management,

"Emotions are a far more important driver of success than IQ. What made Warren Buffett such a great investor was not just superior intellect, but emotional fortitude to stay true to his strategy during deep drawdowns,"

IQ may be useful when it comes to analyzing complicated investments. However, patience, discipline and perspective are all more closely-tied to Emotional Quotient (EQ) than IQ.

The most iconic investors of all time, including Warren Buffett, Carl Icahn, George Soros and Benjamin Graham, have all demonstrated emotional intelligence in their investment decisions.

EQ is about the ability to control our emotions from running wild and interfering with our investment rationale. Examples are: not being influenced by peers or market rumours, not getting too excited when we spot a good investment and buy beyond our means or position limits, not chasing the stock as it goes above our target buy price for fear of missing out, not losing our nerves as the stock keeps on rising or falling, etc.

If we have the IQ to spot a good investment but do not have the EQ to hold on to it until its full potential is realised, our competency as investors will be diminished.

Sometimes it doesn't matter how much complex quantitative analysis you perform on a stock. At the end of the day, share price is determined by the market and not by a number that an algorithm spits out. Financial markets are made up of millions of people around the world. Understanding how other investors are feeling, identifying why they are buying and selling and anticipating what they will be doing next all involve emotional intelligence.

Warren Buffett has pointed out that you don't have to be brilliant to become a great investor. Buffett said:

"Success in investing doesn't correlate with IQ once you're above the level of 125. Once you have ordinary intelligence, what you need is the temperament to control the urges that get other people into trouble in investing."

So in Buffett's eyes, the right temperament and not high intelligence is the key to profitable trading and investing.

Our emotions are extremely intertwined with our money and our financial decisions often have more to do with our EQ (emotional intelligence) than our IQ. To experience better outcomes, we need to make better decisions. To make better decisions, it’s crucial to better manage our emotions and raise our emotional intelligence.

Investing is no rocket science. To be a really good investor, along with intelligence, you should also have high EQ.

"Do not be feverish about success, if your aim is clear and you have the patience to move towards it, nature will support you" - Sri Sri Ravi Shankar

Wright Brothers who marked a date of revolution for the generations to come on December 17, 1903, are a perfect example of "Patience is a key element of success". Wilbur and Orville Wright were no scholars in Physics or Engineering, rather they grew up in a small side street in Ohio having minimal education. They were gifted a toy helicopter by their father when they were kids, they were so inspired by the toy that they wanted to make a machine through which humans could fly and they took their passion to the extreme level. The brothers made a living and pursued their mission by initially running a printing business and later a bicycle repair and sales shop followed by manufacturing cycles. They kept working towards their mission: humans can fly. And after decades of struggle, persistence and patience, they landed with one of the biggest inventions in the history of mankind: the first airplane.

The story depicts the worth of patience and how having patience will help you live your dream. There is a long list of prerequisites and skills required to become a successful financial advisor, and Patience holds a prominent position amongst the various components of the list. It is widely accepted by the financial advisor fraternity that Patience plays a key role in the advancement of their business, yet it is one of the most difficult to follow.

For our advisor brothers, we would like to call your attention to the fact that is no shortcut to success, efforts are required from your end in all phases of your business. You must maintain patience when you enter the business, when you are trying to grow your business and even when you are running a large setup with many clients and employees.

Just imagine, you have been standing in an Aarti for an hour, you haven't eaten anything since morning and finally it is the time for the Prasad distribution, and you have to stand in a long queue to get the Prasad. The people standing ahead of you are the obstacles that you have to face to reach your destination, and you are waiting for your turn patiently. You finally reached the destination and it gives immense pleasure when you are the leader of the queue, standing tall, getting the Prasad, and every else is looking upto you, following your steps.

Similar is the life of an advisor, Patience is not the ability to wait but how you act while you are waiting in the line. If you give up when you first see the obstacles lying ahead, or you give up in the middle because you just can't handle the hardships anymore, you will never be able to get the Prasad (achieve your target). You have to maintain Patience throughout the queue to satiate your hunger.

The most difficult and crucial stage of advisory business is the 'icebreaker stage'. You are new, you may not know much about the business, you'll commit the maximum mistakes during this time. You have to put in extraordinary efforts to enable yourself stand steady. You have to meet people, make contacts, tell people about what you have for them, and then there will be people who may not trust you because you are new. Yes these circumstances may be irritating, but you have to patient, you have to be focused and you don't have to loose your smile.

Once you have moved ahead in the line and you are somewhere in the middle stage, you'll have either of the two reasonings:

1. When you turn, you may realize, 'I have crossed so many obstacles, I have to be patient, I can see my target and I'll move ahead by overcoming the forthcoming obstacles'

OR

2.You may look ahead and realize, 'Oh my God, there are so many obstacles ahead, I might collapse in between, I can't do it, I'd better leave the line'

You have to decide which path you will follow in the middle of your advisory career, the one which requires patience but will lead you to become the leader or the one where you lose focus and patience, and not reach your target at all. If your choice is Option 1, then you have to be patient build your reputation, you have to maintain the business that you have achieved as well as enter the expansion stage. At any time you do not have to loose focus.

Once you are in near the target stage, you must not forget the value of the obstacles which you crossed. It is because of the humility and composure, you maintained throughout, that you are here. So you must not loose these essential virtues at the peak.

There are types of patience which you should maintain:

• Patience with others: There will be times when the markets are falling and your customers panic, they call you and pester you with questions. You have to step into your clients' shoes to understand their position, it's their hard earned money which is at stake, and they are bound to be agitated. You must be gentle and be patient with them, respond to their calls and explain to them that harsh times will pass and they must trust you and their investments.
• Patience with the universe: Expected the unexpected. Things will not always flow in the pattern you are prepared for. There will be times when your efforts would go futile. A client may confirm a meeting, and you have cancelled an important commitment because you are expecting a big investment from and he doesn't show up, or even after four meetings he gives the investment to someone else. At such points, you must not loose your calm, you have to be Patient with your clients at all times.
• Patience with Self: Having patience within ourselves is the most difficult and crucial. Things will come in eventually. You must not loose heart any any stage of life and business. You must be patient and confident within yourself. If things are not working out today, tomorrow they will. Throughout your journey, you must maintain calm and conquer the obstructions.

You have to be patient with yourself, your clients, your staff, the government agencies, etc., you deal with, because you cannot succeed alone.

Your composure during the most demanding times will be the biggest contributor to your success!