I love reading the BRW top 200 rich list when it comes out.
Sometimes I have even been able to say a friend or two have been on there however not this year.
The following excerpt comes from Michael Yardneys news letter and is a great read.
We can learn a lot from Australia’s richest people, so let’s quickly look at some of the common traits of the people in the BRW Rich 200 list;
1. When they have made their millions they don’t go off and spend their money, but tend to reinvest it in their area of expertise.
2. While many of the Rich 200 took big risks early on in their investment careers, once their wealth was established they stopped taking risks and preserved their wealth. Interestingly, others who kept on speculating or taking risks lost a significant portion of their wealth.
3. In general the wealthy do not diversify. They have one good idea and repeat it, or specialise in one business or investment niche.
4. They tend to invest in growth assets (more than for cash flow.)
5. They are good at picking trends or cycles. They know when not to invest, they hold back near the peak of booms. And they also understand the power of investing counter cyclically when properties or shares are “on sale.”
6. They recognize that there is no such thing as a self made millionaire, and have attracted a team of good people and trusted advisors around them.
7. They are confident and “just do it.”
One of the major lessons I believe you should heed is that of counter cyclical investing. Buying at or near the bottom of a cycle. Buying when people are saying you’re mad to buy.