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Weekend Edition – It’s a Numbers Game

As we come off a few days of sitting around with family, the takeaways usually include life updates, good stories, tough stories, and more.

The topics of conversation at annual gatherings are usually the same. This year, the presidential election was certainly one that was a main theme, along with many other topics like:

  • What's going on at work?
  • How are the kids doing in school?
  • Doing any shopping over the Thanksgiving weekend?
  • How did you survive the storm?
  • Aren't the New York Jets awful (my favorite of course as the suffering continues)?
  • What's the market going to do?
  • …and so on.

Regardless of the answers to these questions, sooner or later most of us realize one thing: eventually success and failure are defined by numbers.

We may think retail sales will be slow this season, but then we'll hear some data about how great sales were, and presto, our mindset quickly changes. We may think the earnings reports in the first quarter will show a rebound and then presto, we get a slew of warnings and optimism quickly diminishes. We may think our job is important to our company's existence and then you hear rumblings about missed projections or management deciding to change direction as things may not be as strong as you think they are, and now your financial foundation is in jeopardy. What's it all tied to? Numbers! That's all it is. In sports, it's about winning and that's it. As Vince Lombardi once said about winning, if winning was not important then why do they keep score?

Some people take unfavorable results in life too personally. In reality, it's just a numbers game. Knowing this fact is the key to understanding what ultimately defines how smooth our financial and professional course will be. Companies don't shut down to teach workers lessons, they shut down because the numbers just don't work anymore. Teams fire coaches, not because players don't like them, but simply because the team isn't winning. There are plenty of examples where teams love playing for certain coaches, but the end result doesn't add up to a trip to the playoffs or a shot at the championship.

Investing is no different. There will be a time when stocks that have made great runs will no longer matter for our portfolio because they simply aren't performing for whatever reason. It's on us to decide when to pull the plug. The same applies to our professional and personal lives. Realize this fact and you will be smarter and more prepared for eventual pivots we all need to make at times.

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Thank you for sharing part of your weekend with me, and please be sure to pass this post on to anyone you think we can get inspired and educated about money, building wealth, and using common sense to do so.

Be sure to visit our complete recommended list of the Best Dividend Stocks , as well as a detailed explanation of our ratings system here .

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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