Read? No Cut Losses & Multi-baggers For Long Time
In RETAIL investing; where we ALONE and OURSELVES are fully responsible for our own money but there will be full of CONVENTIONAL market wisdom folks offering their free advice thinking they are "smarter" in their portfolio and management without proving their strategy is so superior.
Conventional market wisdom : Cut loss to preserve capital to fight again!
Conventional market wisdom will generally work well for the mass.
What if we are not those who are on this path of conventional market wisdom?
Doom? Die?
Uncle8888 made Hay while Sun shines and avoid having to pull out any Winter weeds. He has plenty of Hays to survive long and harsh; why he needs to worry over those smaller Weeds that won't kill him?
He doesn't need to eat Water Melon into the Green as he can afford to waste some juicy Red without feeling much pain.
In investing; it is all about 3Ms- method, MIND, and MONEY MANAGEMENT.
Money management is NOT just about CUT LOSSES. It is more than those conventional thinking.
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I join in the fun by revealing a bit of cleavage:
ReplyDeleteMoney Management
There's another technique I did not describe.
Look at Qian Bei's multiple rounds of trading Keppel. That's trading around a core position.
These realised profits stuffed under the pillow will become very opportunistic when the core holding suffers from a temporary bout of flu ;)
Just make sure its not pneumonia hor!
There's no such thing as "bao jiak".
Just look at AIG. Cannot fail one right?
Yeah right... Although it was bailed out by the Govt, the original shareholders got less than 10% of their money back... It's just a difference between 100% loss (bankrupt), and 90% loss (bailed-out).
temperament,
DeleteTo let a 10 bagger go to 5 bagger is not exactly fun. Yes, we didn't lose money; but still...
Like you've said, it takes lots of conviction (and luck) to take some money off the table near the top, and re-invest them near the bottom.
Conventional wisdom says it can't be done.
Yet if I don't attempt it, what's the point of me doing it full-time?
Comparing to GIC and Temasek can console us. ha ha.
DeleteMarket wisdom is full of paradox. Don't sell your winners, cut your losers, time in the market not timing the market...I guess for every action to do A, there's an equally valid advice to do the oppposite action B.
ReplyDeleteI guess we need wisdom to know when to apply what advice.
But how to gain wisdom? Must have experience loh. How to have experience? Make mistakes loh LOL