There’s the story of a disciple who went to his master and said, “Could you give me a word of wisdom? Could you tell me something that would guide me through my life?”

It was the master’s day of silence, so he picked up a pad and wrote, “Awareness.” When the disciple saw it, he said, “This is too brief. Can you expand on it a bit?”

The master took back the pad and wrote, “Awareness, awareness, awareness.” The disciple said, “Yes, but what does it mean?” The master took back the pad and wrote, “Awareness, awareness, awareness means—awareness.”

So it is with investing. Our master George Goodman, the American writer who demystified markets in his best-selling books, said that the first thing you have to know is yourself. “A man who knows himself can step outside himself and watch his own reactions like an observer,” he wrote in The Money Game, published in the spring of 1968.

Investing entails two other things: clarity of perception (in as much as we’re capable of) and accuracy of response. What connects the two is awareness.

We are more likely to respond accurately when we perceive clearly. When our perception is distorted, for any reason, we’re not likely to respond the way we should. Awareness allows us to observe and judge every situation on its own merits rather than rely on a rigid and unyielding thought process.

When you were losing money on a position, were you aware that this is still only a game, that the position doesn’t know you own it, every day is a new day, or were you simply identifying with the losing position?

Later, when you had the time, did you study the experience and attempt to understand it? Where did it come from? What brought it on? Were you free from outwardly imposed attitudes and reactions? “Be the witness of your thoughts,” as Buddha said.

That’s what it is to watch yourself. We don’t know any other way to awareness. We can only change what we understand. We have to develop our own personality when investing. We must learn to know our inner world as clearly as the outer one.

The ultimate objective is to ride the waves of the turbulent markets with utmost centeredness, calm, and joy. The master said, “The end object of investment should be serenity.”