Here’s a way that can help you strengthen your investments and improve their performance: double your power.
What does this mean?
When two chess pieces work together on the board, they can create an impenetrable force. Frequently, chess experts follow this method by lining up two pieces that have a similar pattern of moving in order to deliver a “one-two” punch.
Here’s a real-life example of how this works. (If you’re not a chess enthusiast, skip ahead to the next paragraph to learn how to deliver a “one-two” punch with your finances.) In 1992, Susan Polgar played Anatoly Karpov and used a pair of white rooks to confront Karpov’s king. Each rook protected the other, while simultaneously presenting the threat of checkmate. Two moves later, White delivered the final blow, adding the queen’s power to an already strong position. By getting her pieces to work together, and using a “one-two” punch, Susan won the game.
To watch a two-minute video showing how Susan Polgar used double power to defeat Anatoly Karpov, click here.
Strengthen the power of your investments
This principle can also apply to investing. Investors sometimes forgo the important tactic of consolidating their forces. Instead of strengthening their more powerful positions, they invest small sums of money here and there, hoping to find something better than what they have. Even worse, they may sell a strong position in order to free up cash to try an unknown possibility.
Boost the power of your investments by finding the more successful ones and adding to them. Pairing up your strong pieces by putting more money into your strong investments may strengthen your current asset pool.
For more about consolidating your assets, read this.
Douglas Goldstein, co-author of Rich As A King: How the Wisdom of Chess Can Make You a Grandmaster of Investing, is an avid chess fan, international investment advisor and Certified Financial PlannerTM.
If you aren’t already signed up to receive our newest blogs by email, sign up now!