As from April 2013 my Journey in Investing is to create Retirement Income for Life till 85 years old in 2041 for two persons over market cycles of Bull and Bear.

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This blog is authored by an old multi-bagger blue chips stock picker uncle from HDB heartland!

"The market is not your mother. It consists of tough men and women who look for ways to take money away from you instead of pouring milk into your mouth." - Dr. Alexander Elder

"For the things we have to learn before we can do them, we learn by doing them." - Aristotle

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Wednesday, 9 May 2018

My Own Psychology Of Losses: Losing Money And Deploying Cash Is Not The Same!




















From 2000 to 2003 - two crises Sep 11 WTC Attack in 2001 and SARS in 2003

Uncle8888 came to the stock market at the wrong market timing with his large war chest i.e. 23 years of saving including CPFIS at age of 44.

STI was at its peak in Jan 2000 and then crashed towards its low in Sep 2001. The market recovered in 2002 and then crashed again in 2003 due to SARS.


Those days from Jan 2000 to 2003; he didn't have ill or bad feeling on paper losses as he was in mindset of deploying his rotting cash in his war chest into the stock market to create wealth. In his mind; he was deploying cash and not losing money!


But from 2007 to 2009; his feeling of falling market and paper losses was totally different. Towards end 2008; he has developed that ill feeling of losing money in the stock market. 

WTF and bang his head! Why like that!

Now he understands his own psychology of losses!

Losing money and deploying cash is not the same!

Why he must have larger war chest for the next market crash?










7 comments:

  1. Losing money = no cash to deploy when opportunity strikes so positions are all stuck. Is that a correct interpretation?

    ReplyDelete
  2. Losing money=after deploying all targeted money when opportunity strikes, also only can watch only.

    Only in 2008/2009 i watched letting go opportunities in front of my eyes yet i still had about 30 to 40 % of cash.

    Got cold chicken feet lah.

    Actually this time around, market is really "different" because Gs of the World can QE anytime, negative interest rate, blah, blah, so many new phenonmenums indeed.

    Blur Block liu.

    ReplyDelete
  3. Quite a number of people think the market still can go up because of what i have just said above.

    In fact, also many people think without US FED Treasury proping up the REPO market, the market could crash worse than in 2008/2009 because the debt/bond market is now much more worse then 2008/2009 market's situation. Experts said.

    Come 2020 new year, Dow hits newer, higher peak?

    Never say never in the market, either way.

    So is in life neh.

    ReplyDelete
    Replies
    1. Next QE, govt gives every voters some money to spend

      Delete
    2. Ha! Ha!

      Sound quite familiar nearer to homeground leh.

      Delete
    3. Actually proping up the REPO market, many think is QE already.

      Delete

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