Act On Your Knowledge

The diagram on the left is from http://wamyentrepreneur.wordpress.com/2012/07/21/route-to-possession_part-two/

It drives home a very important point:If you would be wealthy knowledge is important, but acting on your knowledge is more important.You make money in proportion to the amount of Right Action you have done rather than Right Information/Knowledge/Thoughts you have.As the author puts it ” Knowledge is not possession, this is to say that to know does not imply automatic acquiring; it merely opens our eyes to possibilities and like belief, it must be acted upon for it to yield fruits…”

A person who picks a good stock at random and a person who does so using a fundamental analysis of the company are at the same situation.They have arrived at the right prospect.Now the important thing is who buys how much and hangs on to it.The only advantage the person who can do the analysis has over the other is that he can find other opportunities.But in life just one right decision and one right action can make a person wealthy (and the reverse is also true.)

An action bias is fundamental to becoming wealthy.Knowledge,experience and patience just help fine tune one’s ability to accumulate wealth.