Friday, December 25, 2009

Christmas day's reflections

The more I stay in the market, the more I realised that being calm and steady is the only way to win consistently. I've dealt with higher volatile instruments before and the conclusion is that you don't want to be too happy when you win and too sad when you lose. In the short run, what you see is the variability of your system, not the returns. A short run of good wins will be interrupted by a short run of bad losses.

Since today is Hohoho day, I use the opportunity to hammer in some reminders for myself with regards to my love-hate-relationship with the market. Not in any particular order of importance,

1. Be zen. Treat both your wins and your losses with equanimity.

For the boh tak chek, equanimity describes the unattached awareness of one's experience as a result of perceiving the impermanence of momentary reality. It is a peace of mind and abiding calmness that cannot be shaken by any grade of both fortunate circumstance and unfortunate one.

2. Spend some of your winnings.

I think it's important to buy yourself something nice, to close in the winning. Money is just a means, not the end, so I think it's important not to accumulate money but to do something worthwhile with the money. In your death bed, I don't think that you'll worry about not making more money. Converting money into nice memories is what I'll do.

3. Enjoy the little things in life

Hey, market is not everything. Spend time with your friends and loved ones. Take time off the market, enjoy reading a book and playing some games. You'll be surprised how getting away from the market for a week or so can let you see things from a different perspective. I learnt this from the movie, zombieland-> Rule no. 32

4. Don't be too harsh on yourself

I missed DBS in March when it's 6++ and now it's 14++. I missed selling swiber at 3++ and now it's 0.9++. Ya, I suck in this game, but I'm learning along. I missed some good moves and ride on a couple of bad ones but look, I'm still here chatting with superfriends in the cbox and having great power lunches with them. While everyone should treat the stock market seriously like it's a side business, but take it easy on yourself if you missed the good moves and somehow caught all the bad ones.

Bad luck don't go on forever - so does good luck.

Have yourself a merry christmas :)


Musicwhiz said...

Merry Christmas LP!

I realize I never get too excited about the stock market. "Winning" doesn't make me very excited and "losing" just spurs me on to do better. Hope I can keep this attitude for the rest of my investing life.


Anonymous said...

Hi LP,

Hohoho Un Joyeux Noël et Une Bonne Année de France.

I've been a great follower of your column and infact I was first introduced and made my entry to stocks and equities when I chance upon your posting around January this year. I've made some and loss some and initially I've so much sleepless night with the antcipation of the investment that I made. But as I gradually and progressively ponder and reflect through the dosage of advices that you administer I've began to be cognizant of the fact that I should not be intensely excited over the ups and downs of the market but remain calm as things unfold and invest prudently.

Merci for putting me through this stock school of thoughts as I'm now more confident and cautious in the stock market.


Createwealth8888 said...

If you are a investor, your success in your investing journey is measured in term of decades and not in the number of months or years.

If you are a trader, your trading success is measured in term of thousands of trades and not just hundreds of trades.

Lau said...

for pt 2, i always find it difficult to balance.

A) play now, suffer later.
B) save now, play later.

we do not want to die tmr in regret for saving everything. yet do not want to live tmr not having saved anything.

Createwealth8888 said...

Lemizeraq said...

Hi LP,

Peter Lynch book states that you of 10 stocks you buy you only need about 4 to 5 multibaggers winners and you can afford to have 2 to 3 losers.

His reasoning is that the stocks with the upside can multiply by a few times, but the stocks that is a loser is limited by what one has put in.

So don't be too hard on yourself on point 4. Else everyone will be berating oneself for not buying Apple when it was around $9 when Steve Jobs went back the second time. Or get a piece of Google when it went to IPO.

Happy New Year !


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Anonymous said...

Agree with you about spending winnings and enjoying little things in life.

All the best in 2010!

PanzerGrenadier said...


Yes, there is more to life than money. I'm trying to strike a balance and will be taking action to make some lifestyle changes but sacrifice a bit of financial freedom, i.e. defer it a bit more.

Overall, life is about experiences we savour. Moderation, I believe is the key to successful living and investing.

Be well and prosper.

la papillion said...

Hi mw,

Wow, I think you're on your way to zen-ness :) I think this kind of attitude can spill over to life in general :)

la papillion said...

Hi Herman,

Ont une nouvelle année très heureuse aussi!

Hey, thanks for following my blog :) Didn't know I had so many advice to give, haha :)

May you make more money in the market!

la papillion said...

Hi bro8888,

Well said. It's hard to measure one's success from a mere good quarter or a few trades. Most people (me inclusive) are easily tricked to mistake luck for skill, much to my own misfortune, haha

la papillion said...

Hi lau,

Hey hey, I've trouble spending too, haha :) I tend to underspend, and that's my equilibrium.

la papillion said...

Hi lemi,

I used to lament that I miss this and that, but no longer :) No point regretting, might as well spend the time and effort to find the next one haha

la papillion said...

Hi caizhixiong,

Interesting this pt took me quite some time to realise, because I'm usually such a slave driver to myself. Used to have a perfectionist streak too, which makes me hard to enjoy the little things in life too.

Let's hope the new year will bring new insights too :)

la papillion said...

Hi PG,

Haha, well said :) I would gladly defer my FF status to enjoy now and then because we'll never know when we'll pop.

You too, be well and prosper :)

dream said...

lp, I see that you have a tie up with "busty london escorts".


I assume you won't be underspending on bros this new year.

PanzerGrenadier said...

Re: Busty London Escorts

Been getting some spam comments too in my blogspot blogs... A bit irritating...

Anyway, wishing one and all a Happy New Year 2010!

Be well and prosper!

la papillion said...

Hi PG,

Have yourself a merry new year too :)

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