Enneagram x Stock Picking (Part VI): Type Six Skeptics
Healthy skepticism versus pessimism - it is a fine line. By Benjamin Tan
Back in August 2022, I wrote an article on this blog titled “Doubt: Your Enemy and Your Friend when Investing” using Meta Platforms (META 0.00) as an example of a large, established enterprise being subject to extreme market skepticism. From being a technology darling, its share price went well below $100 in Q4 2022 as bearishness grew louder, especially with its high-stake metaverse pivot and concerns over Apple making more changes to its privacy policies. It was not uncommon then to find fatalistic commentary about the long-term viability of this social media giant.
For investors who are natural skeptics - known as Type Six in the Enneagram world - it would have been hard for them to keep holding onto a stock like Meta, let alone double down when stock price fell by more than half within months.
Type Sixes: Skeptics
If you respond “Yes” to most of the statements below, you may be a Type Six:
Before making important decisions, you tend to first seek guidance
You tend to purchase goods and services - including groceries; legal advice; medical care; fashion apparel; electronics - almost exclusively from well-known brands because you trust them, rather than experiment with newer, lesser-known names
At work, if you sense a lack of support from colleagues or superiors, you are more likely to feel discouraged than motivated to prove yourself to them
When analyzing problems - at work or in your personal life - you like to consider multiple upside and downside scenarios, each with its own set of variables, and hence you often find it hard to make up your mind
Between "what can go wrong?" and "what can go right?", the former resonates stronger with you
Putting money at risk may seem like the very last thing Type Six personalities want. Why endanger their sense of security by taking money out of the bank – where it is truly safe – and subject it to the whipsaws of market forces? Already a Type Six is naturally inclined to be in a state of polarity, shuffling back and forth between opposing thoughts; adding on worries that come with putting money to work may seem like a mental burden not worth having.
Type Sixes belong to the cerebral triad (alongside Types Fives and Sevens) of the Enneagram. Unlike Type Fives who are rooted in their own minds, or Type Sevens seeking mental stimulations from outside experiences, Type Sixes shuffle between internal thoughts and external opinions.
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Safety First: Some Asset Classes Work Better for Skeptics
Type Six investors seek safety in everything, including financial decisions. It does not mean they cannot invest at all, but they need to feel secure before taking any action with their money. They are usually not the ones to back early-stage companies or to be contrarians. Trying to defend a hold or buy thesis on Meta Platforms at the depths of market doom in Q4 2022 would have been challenging.
This has several implications for their investment approaches. They are likely drawn only to assets that have been validated by others, hence real estate, diversified index funds, and larger capitalization corporations are attractive destinations. When buying their homes, for example, Type Six investors may only direct their capital towards residential properties located in established areas, staying clear of any unfamiliar territories.
Type Six Investment Journey
The key to investing for Type Six investors is anxiety management. If uncomfortable risks are taken at the start of one’s investing journey and asset prices go awry too soon – which almost always happens – a Type Six investor may become more motivated to eliminate the anxiety and give up altogether.
On the other hand, starting conservatively – both in choices of investment assets and quantum – will allow Type Six investors to build up more self-confidence, before graduating to either larger deployments or higher-risk categories to make money a little work harder. Structure, pace, and regularity are therefore important for Type Six investors.
The naturally meticulous and vigilant Type Six personalities have the makings to become excellent investors. Their abilities to comb through upside and downside scenarios, assess risks exposures, and monitor changing investment theses are intellectual skills that will serve them well in the long run.
Why Learning about Our Motivations for Stock Picking Matters
This is Part Six of a series of post that I will be writing on Enneagram x Stock Picking. Below are the links to the first five:
Enneagram x Stock Picking (Part I): Type One Perfectionists
Enneagram x Stock Picking (Part II): Type Twos Investing in AMC to Save Movie Theaters?
Enneagram x Stock Picking (Part III): Type Three Investors, Successes, and Delaying Gratification
Enneagram x Stock Picking (Part IV): Type Four Investors and their Emotions
Enneagram x Stock Picking (Part V): Type Five Investors inside their heads
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”
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