Losing Is Part of the Process

I’ve been unfortunate as of late, on the receiving end of several bad ideas that turned into money losing ventures. I like to remind myself, as well as people around me, that the business of speculating is nothing more than a game of peaks and valleys. It’s important to moderate the valleys, while maximizing the peaks of course. I’d be perfectly content with booking 10 losing trades in a row, if I could nail just 2.

Most of the time my losses are small, anywhere from 3-10%. At times, due to the complexities of the market, ideas run aground and minor setbacks become impediments. Throughout my career, especially early on, I recall feeling a distinct sense of doom following large losses.  I felt as if I could never make the money back. The hole was too big and nothing that I could see at the time could “bail” me out. Lo and behold, with a little patience and plenty of smarts, I dug myself out and buried my enemies where they stood.

There’s an old saying, famous around these parts: “The Fly wins all the time, even when he is losing.”

To clarify,  losing is nothing more than a waystation, a temporary set back of sorts, to greatness. Some of you scratch your heads in amazement how someone could be so bold, yet distinguished. I only talk to you this way because it is my right to do so. Once you’ve gone through the motions, the investment life of Le Fly, you will learn to never bet against a person, such as myself.

You come to this blog and witness lots of people are reading it. Naturally, this is true. I never tried to become a world famous blogger in the arts of finance. It was my natural born right to do so, no different than it is the right of your neighbor to throw trash on your lawn or be a pervert.

The point I am trying to make, and did so quite effectively if I might say so, is that we’re all on a path, all unique but deliberate. The foundations of these paths were etched out many years ago, through the toils of hard work and ingenuity. Hubris has a way of muddying the waters, giving those who do not possess talent to feel a sense of entitlement. This is false hope and misdirected energy.

At the end of the day, it’s important to take a step back and realize who you are, limitations and all, with regards to the game of speculation.

Whenever a young chap comes up to me and talks with me about his investment career, I always ask “what was the first stock that you lost a million dollars in?” No one likes to talk about their losers because most cannot deal with adversity. They feel it makes them look weak. Quite the contrary. I wear my losses on my arm like a badge of honour. They are my battle scars, reminders to enjoy the moments when I am peaking.