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Balance Finance with Feelings

Most people consider negative emotions to be a source of constant irritation and discomfort. It is not because the inherent nature of emotions but more importantly their inability to deal with them effectively.


While a lot can be said of the value of emotions in our lives, in this article we explore how understanding one’s emotions and being able to engage with them effectively could be a source of substantial financial gain.


Soros Fund Management, LLC is a private American investment management firm\ founded in 1969 by George Soros[ and in 2010 was reported to be one of the most profitable firms in the hedge fund industry,[ averaging a 20% annual rate of return over four decades. Until 2000, the Quantum Fund was the world’s largest hedge fund. In the week leading up to September 16, 1992 or "Black Wednesday," Quantum Funds earned $1.8 billion by shorting British pounds and buying German marks.This transaction earned Soros the title of "the Man Who Broke the Bank of England".


In his book titled, “The Alchemy of Finance”, Soros presents a theoretical and practical account of current financial trends. Details his innovative investment practices along with his views of the world and world order. President of the phenomenally successful Quantum Fund, which has 4.2 billion in net assets, Soros describes his ``theory of reflexivity'' which underlies his unique investment strategies. Through this theory, Soros expounds his framework for investing which involves a very close and intimate realtime engagement with the stock markets, both in times of booms and busts.

Rather than trying to predict the equilibrium position of the market, by contrast, the theory of reflexivity takes the active participants as its starting point. Therefore, it provides a useful conceptual framework, which he had used. What it cannot do is to enable the participants to occupy the position of a detached observer.


as mentioned in the book, he tried to put himself into the position of an outside observer and remain as detached as possible. He realized that it is impossible to rid oneself of emotions, yet it is important to keep one's emotional state as stable as possible in order (o haw a solid platform from which changes in the outside world can be evaluated. He felt that if the platform itself is responding to different emotions than the market it becomes difficult to observe changes in the market. The task is easier if the participant is moved by the same emotion. That is what he sought to achieve by identifying himself with his fund. It should be recognized, however, that the process involves something very different from rational thought; it is better described as empathy.


As per Soros’ the participant enters into the mind of the market and tries to understand it from the inside. He found the task easier than most other investors, partly because of his conceptual framework and partly because he identified myself with his hedge fund so intimately. He assumed that the market felt the same way as he did, and by keeping himself detached from other personal feeling, he could sense changes in its mood. This was a hard discipline. It meant subordinating his own emotions to those of the market. It made it difficult to maintain other emotional involvements and his family had good reason to resent it. But he looked on himself as an athlete or a boxer in training who had to sacrifice many other things for the sake of success since managing a hedge fund required single-minded devotion.


While this is only a single example of harnessing the power of emotions, for achieving abundance. it clearly shows us what's possible. Can we too learn to effectively handle our emotions to bring abundance into our lives ?

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