Enneagram x Stock Picking (Part III): Type Three Investors, Successes, and Delaying Gratification
Enneagram x Stock Picking (Part III): Type Three Investors, Successes, and Delaying Gratification
Driven to perform and win, Type Three investors only want to know success. By Benjamin Tan
Out of the nine Enneagram types, Type Threes may be the easiest to spot. In social settings, typical Threes are well-dressed wherever they go, demonstrating their superior sense of style. Status symbols like designer clothing and accessories are not uncommon. In the corporate world, having that prestigious title, working at a gold-plated corporation, and travelling on business class resonate with these achievers.
In other words, image is important.
A Type Three personality is goal-oriented, competitive, and always in vogue. Known also as “Performers”, Threes want to be seen as successful and accomplished to garner admiration from others. They are highly geared to move ahead in winning those trappings of success.
Type Three: Performers
If you respond “Yes” to most of the statements below, you may be a Type Three:
Checklists, to-do lists, and productivity apps are familiar tools you like to use to become more efficient, even for your personal activities
You dislike confrontations for fear of alienating people or staining your image
You are competitive, often comparing yourself to others in your life
You are conscious of how you come across to others, especially those whose opinions matter the most to your career advancements
You have considerable ability to compartmentalize your emotions to remain poised on the outside
Possessing great social instincts, you can read people and situations before adapting your behaviors, communication styles, and presentations accordingly
For quick reference, below are the primary motivations associated with each Enneagram type.
Type Three Investors: Emulating the Best Fund Managers or Doing the Minimum?
Wouldn’t Type Threes make model fund managers when investing their own money? They are competitive (striving to beat the benchmarks), efficient (staying on top of disclosures and macro developments) and look the part (dressed to kill). Picture the likes of Ray Dalio, Seth Klarman, Sir John Templeton, and Catherine Wood – the most inspired Type Three investors will mold themselves to fit in with the greats to one up on Wall Street, plus everyone else while at it.
Type Three investors can beam with maximum pride when they hit their multi-baggers. Achieving hyperbolic returns and beating everyone else resonate in perfect synchronicity with their core motivation to be the best and desires for more access to status symbols.
On the other hand, some Type Threes may choose to do the minimum or nothing at all when it comes to personal investing, for fear of potential failures. Those who do identify with retirement planning may veer more towards indices and reputable mutual funds to avoid market underperformance. To feel responsible for making bad investment choices is something that the more self-conscious Threes will avoid. There is no underperformance when investing in index funds, or personal responsibility when stock-picking decisions are outsourced.
Potential Traps for Type Three Investors
A potential pitfall to desiring admiration is jumping onto investment bandwagons just for the sake of being seen as part of the zeitgeist. If investing in seemingly cutting-edge electric vehicle makers was the trend, Threes might dive into the fray without thoughtful consideration. If holding Bitcoin will make them feel like they are part of the cool kids’ club, then partaking in cryptocurrency becomes likely.
Possessing motivations rooted in the perception of others is certain to distort decision-making, leading to stark misalignment between investments and inherent merits or suitability.
Delaying Gratification: A Key Challenge for Type Threes?
A challenge that Three investors may face is taking chips off the table too soon. There is nothing wrong with cashing profits per se, but if that is driven by an eager desire to make discretionary purchases, one may end up getting short-changed. That Diane von Furstenberg dress or BMW convertible funded by profits from a successful investment may end up with a much larger price tag, if opportunity cost is added.
Take Amazon (AMZN 0.00%↑) as an example. It went public on May 15, 1997, at $18, or a split-adjusted equivalent of 7.5 cents, as of 2022 following its 20-for-1 split. At the time of its initial public offering, Amazon’s market valuation was just below $500 million.
It did very well for shareholders during its first iteration as an e-commerce marketplace, but its status as a trillion-dollar company only got into stride when Amazon Web Services was launched in 2006. That business line has since become the key value and profitability driver for Amazon, far eclipsing all other segments combined.
Staying invested for the long haul, especially in winning companies – and delaying immediate gratification – is key for Threes to reap the full rewards of their investment successes.
Why Learning about Our Motivations for Stock Picking Matters
This is Part Three of a series of post that I will be writing on Enneagram x Stock Picking. Below are the links to Part One (Type One Perfectionist) and Part Two (Type Two Giver)
Our best traits and core motivations are often accompanied by closely related blind spots and unhealthy biases. It is therefore important to clarify our primary underpinnings for investing in singular names, because they can reveal the specific personality pitfalls we face as investors.
To find out more about your typology, try the free test on my website.
I shall be writing more about Enneagram types and personal investing in the weeks to come. Stay tuned and subscribe. Meantime, visit my website “Enneagram Investing”
Follow me on Twitter @ConsumeOwnTech and Commonstock @ConsumeOwnTech
Represented by Savvy Literary
Subscribe to Consume Your Own Tech Investing FOR FREE to receive a welcome email with the following:
Latest Top 10 positions in my high conviction portfolio that combines value with growth stocks
Book recommendations on investing, consumer and technology sectors
One article delivered into your inbox every Tuesday
Preview of upcoming articles