1/ a quick thread on trading, investing, and managing your own psychology.
we've all had moments where hindsight gives us 20/20 vision into a trade, an investment, or deal.
*BUT* we're bad at incorporating these experiences into our future decision-making.
we've all had moments where hindsight gives us 20/20 vision into a trade, an investment, or deal.
*BUT* we're bad at incorporating these experiences into our future decision-making.
2/ there is not enough self-improvement or mental fitness training out there for our relationship with money 💸 it's a toxic relationship for many
but you can take more ownership and control of your financial decisions by adopting some simple self-improvement practices!
but you can take more ownership and control of your financial decisions by adopting some simple self-improvement practices!
3/ start by keeping a journal of your investing decisions. document *why* you're doing what you're doing.
simple questions:
- why am i investing?
- what are my expectations of return? are they realistic?
- what is the timeline i plan to hold this?
- how am i sizing this?
simple questions:
- why am i investing?
- what are my expectations of return? are they realistic?
- what is the timeline i plan to hold this?
- how am i sizing this?
4/ re-visit your investments periodically and write down how your feelings change.
- what did you get right? what did you get wrong?
- how was your sizing? was it too small, too large, or appropriate for your portfolio
- how does this investment make you feel? worried? content?
- what did you get right? what did you get wrong?
- how was your sizing? was it too small, too large, or appropriate for your portfolio
- how does this investment make you feel? worried? content?
5/ get actual data and review it!
look at your portfolio of investments and evaluate timing, risk, distribution across asset classes and sectors, effort / $ invested, look at it all
now write down how it makes you feel. write what you want to do differently next quarter.
look at your portfolio of investments and evaluate timing, risk, distribution across asset classes and sectors, effort / $ invested, look at it all
now write down how it makes you feel. write what you want to do differently next quarter.
6/ you can keep these notes anywhere, just keep it all together and keep it organized in a way that works for you and is easy to reference. your system will improve over time.
now when i trade, i take 2 minutes to jot down my thinking. i can now spot patterns.
now when i trade, i take 2 minutes to jot down my thinking. i can now spot patterns.
7/ investing is just like any other skill - you can actively work to get better by tracking, evaluating, and improving your skills.
your psychology and your emotions are your most dangerous enemy. understanding how you react to your feelings can help you make better decisions.
your psychology and your emotions are your most dangerous enemy. understanding how you react to your feelings can help you make better decisions.
8/ not advice, DYOR, but don't *not* invest because you're afraid or because of past mistakes. invest time and energy in getting better at investing!
i have too many conversations w people about "i wish i" "i should have" "why didn't i" - and i have little sympathy for them
i have too many conversations w people about "i wish i" "i should have" "why didn't i" - and i have little sympathy for them
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