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Promissory Note Investing: Science, Psychology, and Emotions

Other People Create or Destroy the Value of Your Assets

Psychology vs. Science
Promissory note investing is not an exact science. Crunching the numbers can be an exact science. Making business decisions, judgments, assumptions and predicting the future is personal, emotional and opinionated, the opposite of an exact science. Separate the "hard numbers" from the "soft emotions".

The investor's psychology and point of view is equal to, or of greater importance, than the numbers in influencing the investment decision. Almost all decisions are emotional decision, whether admitted or not.

Predicting the Future
Analyzing the documents and the information they provide leads to forecast future cash-flows and future events. The data may be large and required making numerous calculations. Regardless of how refined your conclusion, your confidence in the answer is influenced by your emotions and by your personal points of view. Your prediction of the future performance of the note investment is not a fact, it's your prediction; it's your best opinion.

No one can accurately predict the future. There are no exact answers, only educated, reviewed opinions. Develop the confidence to make decisions based on your best, researched opinion.

People Impact Values
The financial information, facts and documents for promissory notes are only part of the total picture. Promissory notes do not exist in a vacuum. The parties to the transaction impact and influence each other; parties outside of the transaction-potential buyers, sellers and brokers-affect the attributions of other investors and the value of the investment asset.

Local and national economic activity, or lack of them, affects the value of the asset and the emissions of the participants. Those same activities impact the attitude of bankers, appraisers and other investors not directly involved with your specific transaction.

These internal and external…


Source by Lawrence Tepper

The post Promissory Note Investing: Science, Psychology, and Emotions appeared first on Note Investing Seminars.

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