Unshakeable

Year of publication: 2018

Author: Tony Robbins's
256 pages
Link for purchase: https://amzn.to/2KIyLty

Unshakeable (2017) is a bestseller by Tony Robbins that provides a

detailed and practical guide to the principles and rules for investing in
today's unpredictable economy.
He draws insights from interviews with more than 50 of the world's
greatest money masters, including Warren Buffett. Tony offers a direct
and practical guide to achieving "financial freedom".
In the book, he advises on investment in mutual funds, index funds and
retirement plans, but in addition to the usual menu, he also reports
basic and intuitive principles for achieving financial peace.

Main ideias of the book

Score
● No one can consistently predict the future of the stock

9
9 Aplicability market, but making predictions is not necessary for success;
8 Inspiration ● To win the "financial game," you must "control what you
8 Innovation can control";
9 Impact on results ● The secret to wealth is increasing lifelong investments;
9 Structure ● Protect yourself against market downturns by
developing a portfolio that is "broadly diversified globally";

● Most people are unaware of the fees they pay to financial services companies for managing their
investments;
● People often are wary of their financial advisors;
● Make sure an investment's reward outweigh its risks;
● The assets you acquire should reflect the nature of your financial goals;
● In volatile times, your brain wants to be afraid: do not listen to it;
● "Financial freedom" allows you to live the life you want to live.

For whom is this book suitable?

Financial intelligence is a recurring subject and recommended for all people who have difficulties or do not know
how to manage money correctly.
However, we can also recommend this guide for financial advisors, business students and people who want to
take over control of their financial future.

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 Overview of the book

Concept 1: Compound Interest

The financial market can seem so complex and intimidating that it

drives away the thinking of many people in making an investment.
Therefore, it is initially necessary to understand its basic aspects.
To navigate the markets, it is important to learn to recognize
patterns. We possess the innate ability to understand patterns and
plan our actions accordingly.
Long ago, for example, we understood the pattern of the seasons and
began to plan our crops accordingly.
In the financial market is no different: through observations, it is
possible to recognize standards and find the best time to make an
I can tell you the secret to
investment.
A basic pattern has to do with compound interest, which is money happiness in one word:
added to your initial sum that continues to yield and adding value to progress
your investment.
Thinking about this, you should separate a portion of your income
and start investing as soon as possible. The more time passes, the
greater your accumulated value.
We can see this in the example the author suggests:

Just by starting out earlier, you can take advantage of the power of composition to create a better retirement even
with only a fraction of the capital invested.
It is clear, then, that it is worth striving to start investing as soon as possible.

Concept 2: the four basic principles

You already understood that the best thing to do is to start early. But how to distinguish a good investment from a
bad one?
To assist in this task, the author lists what he calls four basic principles. They are:

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 I - Do not Miss

The best investors are obsessed with avoiding losses. Why? Because they understand a simple, yet profound fact:
the more money you lose, the harder it will be to return to your starting point.
Let's look at this point. If you invested $ 100,000 and lost 50%, you got $ 50,000. If you now get a 50% profit, you
will get a total of $ 75,000, or $ 25,000 in loss.
In fact, you need a 100% gain just to recoup your losses. A gain of this magnitude could easily cost you a whole
decade of investment.
So to avoid losing money, it is important to recognize that financial markets are extremely unpredictable.
With this in mind, the best investors always protect themselves against the risk of unexpected events - and the
risk that they may be wrong regardless of their intelligence level.
Therefore, you need to establish the right mix of different types of investments, diversifying among them in such
a way that you reduce your risk and maximize your rewards.

II - Asymmetric Risks / Rewards

According to the traditional view, you must face great risks in order to achieve great returns. But the best
investors do not get carried away by this high-risk, high-return myth.
Instead, they seek investment opportunities that offer what they call asymmetric risks / rewards, that is, those
that rewards outweigh risks.
In other words, these successful investors always try to risk as little as possible to earn as much as possible.
The author noted this with the investor Paul Tudor Jones, who uses a "five-to-one rule" to guide his investment
decisions. That means he risks a dollar in the expectation of winning five.
This rule allows you to have a success rate of 20%. Thinking from the other side, you may be wrong 80% of the
time and still will not lose money.
How is this possible? If Paul makes five investments, each of $ 1 million, and four of them fail, he will have lost a
total of $ 4 million.
But if the fifth investment is successful and he earns $ 5 million, he will have recovered his initial amount.
In fact, Paul's success rate is better than that. Consider that only two of his five investments will evolve as
expected. That means that those original $ 5 million eventually increased to $ 10 million.

Great things are not accomplished by those who yield to trends

and fads and popular opinion. —JACK KEROUAC

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 III - Tax Efficiency

If you are not careful, taxes can easily eliminate 30% or more of your
returns on investments. Therefore, it is important to pay attention
only to the net amount that you will in fact be able to keep.
All the billionaires the author has met have one feature in common:
they and their advisors are really smart on this tax issue.
They know it's not what they earn that counts, but what they keep.
This is real money, which they can spend, reinvest or distribute to
improve the lives of others.
don’t look to jump over
IV - Diversification
seven-foot bars: I look
around for one-foot bars The fourth and last of the four basic principles is perhaps the most
obvious and fundamental of all: diversification. Essentially, it's what
that I can step over. —
almost everyone already knows: do not put all the eggs in one basket.
WARREN BUFFETT However, there is a fundamental difference between knowing what to
do and actually doing what you know. For this, Princeton Burton
Malkiel professor teaches that there are four ways to effectively
diversify:

Different asset classes: avoid putting all your money in real estate, stocks, bonds or any single investment class.
Within asset classes: Do not put all your money into a favorite stock, or just a seaside property that could be
destroyed in a storm.
Markets, countries and currencies around the world: we live in a global economy, so do not make the mistake of
investing exclusively in your own country.
Diversify over time: you will never know when is the right time to buy anything. But if you continue to increase
your investments systematically over the months and years, you will reduce your risk and increase your returns
over time.

Concept 3: Discipline

One of the reasons we need rules and principles to help our financial decisions is the way our brain works.
The human brain disrupts our ability to make rational financial decisions, because we respond to the loss of money
in the same instinctive way that we react to threatening situations.
The way our ancestors reacted by sighting a sabertooth tiger is the same as our brain understands when the stock
market breaks and takes all the money.
Both events are processed as dangerous threats to our livelihoods, and the natural response is to retreat and try to
escape.
When it comes to finances, this is an unfortunate reaction because often the best response to a plummeting market
is to invest more.

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 Remember: when prices are low, it's the perfect time to invest in an undervalued stock that is sure to rise again
soon. That's why rules and checklists are so useful. Before making a mistake by being reactionary, you must go
back to a list of criteria to be adopted and, from there, identify the most rational decision. It's like flying an
airplane. During takeoff, landing and emergencies, pilots have long and detailed checklists to evaluate before
making any important decisions. And that is precisely what any great investor does.
A well-done checklist is a way to protect yourself, as well as make your decision-making process more restricted,
disciplined and trustworthy.
Do you remember the investor Paul Tudor Jones and his rule? He would never make any investments without
first going through his checklist, which includes questions such as "Does this investment have a favorable risk /
reward balance?" Or "Can I expect this to have a five-to-one rate of return?"

Concept 4: Real Wealth

The author believes that what we really want are the emotions associated with money: the sense of freedom,
security and comfort, as well as the satisfaction of being able to share our wealth.
Many people make money, but they do not feel better. Some of the richest people in the world live in constant
fear of losing everything. They feel dissatisfied when they wake up in the morning. Is it wealth?
To feel really rich, you need to take care of your emotions. For this, Tony provides some tips:
You must keep growing: everything in life is either growing or dying. You need to keep your development to avoid
feeling miserable and unfulfilled.
Phil Knight, the creator of the Nike, shares this sentiment. He says the most significant parts of his life was when
he was in trouble with the Nike, where he sold sneakers in the trunk of his car.
You need to donate: donate your money, donate your attention, donate your time. Making contributions is what
brings meaning to the lives of many people.

In this way, it is possible to conclude that true wealth is the emotional wealth, which is achieved with steady
growth, donations of all forms to other people and always seek to move forward in search of the next step.

People love to say that knowledge is power. But the truth is that
knowledge is only potential power

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 What other authors say about it?
According to author Lynda Gratton of the book The 100 Year Life, For greater longevity, people must flee from life
in 3 stages - education, work and retirement - for a life with multiple stages. To have a life with varied stages, it
takes flexibility and change in the way time is used.
Long-term financial planning is needed, with a belief in your skills and self-control for a savings and investment
plan.
In the Mindset's book, by psychologist Carol S. Dweck, it is debated how our beliefs shape our behavior and our
growth. While mindsets produce definitive worldviews, people can change as they learn new skills. Human beings
can be taught to react in different ways, such as facing challenges and thinking differently.
Finally, in the book Winning, Jack Welch discusses that we should always seek quality in our professional life. If
you are not satisfied with your job, find a job that provides enthusiasm in your career, it is very important that
you do not settle and leave the comfort zone.
But when looking for a job, analyze the company as a whole: your team, tasks, salary, career plan and more. And,
when starting a new job, try to surpass all expectations and always give your best.

Okay, but how can I apply this in my life?

Start by tracing your profile and make a doable plan to achieve financial freedom.
Try to understand investor strategies and how they protect equity and increase profits in times of crisis and
difficulty.
The quickest way to put money in your pocket is not to lose it for the rates and financial market half-truths. So, be
sure to know exactly what you are paying for and what your financial costs are.

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