There’s no escaping the folly I’ve just placed myself into, a man who swore to try the bear raids every single time — because fuck Tesla and fuck all of the overvalued tera cap crap. Instead, like a dog, I bought into the dips and REDOUBLED my efforts this morning. The net result has been ruinous. I am diving lower now and the only way to stop it is to liquidate and start again.
I had been up 5% earlier this week and now I am down 2.5% for the week. While this drawdown isn’t exactly life changing, it adds to the recent slump I had been in since the market rally narrowed and was relegated to 10 stocks in the NASDAQ 100.
My hope is for a miraculous rally — but this is more folly and more weakness. The truth is, as you readily know, stocks are GROTESQUELY overvalued, bought lock stock and barrel by presumptive idiots who gamble at the desk and believe this entire rigged business is a game.
It is a game until things go wrong, and then panic hits, which comes with pain, eventually despair and finally acceptance. This is all rooted in hubris, the belief in everlasting greatness. But everything fades and we all peak at some point, markets are no different.
What I am supposed to do is accept being wrong and understand that my cost for XYZ is irrelevant. The larger picture is simple. There are varying degrees of risk that are acceptable, based upon one’s financial outlook and current situation. Because I’ve had such a great year, I’d permitted sloth to replace intelligent thinking. I even re-started by Quant fund at the very top, not because I capitulated to FOMO — but because I wanted to participate without having to manage such a large sum of personal worth.
My mistakes are for all to see and critique and that’s part of this financial blogging experiment. Today you will think I am stupid — because my actions suggest it. By next week, I will once again be a genius — because I nailed a trade or two. Thus the recency bias of this business — a “what have you done for me lately” relationship has and always will exist in money management.
For me, I can only remind myself to “do better” and “think better” because mistakes cost money and money costs time and time is invaluable.Comments »