🧠 Eternal student of human programming!
📚 Exploring the intricacies of the mind and behavior. 🌟
#MindScience #LifelongLearner 🧐🌱
Nov 17, 2022 • 5 tweets • 1 min read
1/5 Losses, no matter how minor or large, were horrible when we were kids.
Whether we scored 1 or 10 points below the passing mark, one fails the exam.
As a result, we have all grown to dislike failure and work extremely hard to prevent it.
2/5 Thus it makes sense that we would move the stop loss, average down a losing transaction, etc.
Small and huge losses, however, differ in the market.
In contrast to childhood, one must regularly accept tiny losses in order to survive in markets.
Oct 24, 2022 • 6 tweets • 2 min read
1/6 A couple is pictured here practicing some dance steps.
Please take a moment to carefully examine the image before responding to the following:
Don't look at the picture again, just recollect it.
(to facilitate understanding of a later-explained concept)
Did you see a man? 2/6 Did you see a lady ?
Did you see a hat ?
Did you see a sword?
Did you see a seal?
Did you see a ball?
Did you see a fish?
Now imagine if I told you that the image was of a seal being worked out with a ball.
Sep 9, 2021 • 7 tweets • 2 min read
(1/7) FOMO / Fear of missing out !
It appears not at bottom nor beginning of a trend but when market is significantly away from bottom.
Frequency - It appears in each and every bull market. Unless you properly learn to handle it, you will keep falling for it in every bull
(2/7) market !
Trend is your friend ie true but not all trends ! Consider all trends as your colleagues. Just like some colleagues becomes friends and others remain colleagues, few trends become our friends and majority needs to be observed for potential friendship opportunities
A thread based on Jesse Livermore Quotes and Trading Rules
*Do not average losses.
Even if based on scientifically proven edge most of us cant withstand the pressure of stocks declining as stocks usually decline much faster.
* When you double your capital learn to take some money out of it. You may need it for some rainy days !
*It takes time to make money. Get rich quick adventurers will die poor.
Year after year majority of mutual fund managers are fooling innocent retailers.
S&P Dow Jones Indices compiles a report on active fund performance versus benchmarks over various periods, from 1 to 10 years.
The report for December 2019 , the latest available, showed that only 35% of large-cap funds managed to beat their benchmark indices over the last 10 years.
A team of psychologists in Berlin studied violin students. Specifically, they studied their practice habits. All the violinists had begun playing at roughly five years of age with similar practice times.
However, at age eight, practice times began to diverge. By age twenty, the elite performers averaged more than 10,000 hours of practice each, while the less able performers had only 4,000 hours of practice.
You must know your risk tolerance. Truth is it’s lower than you think.
If you try and guess your risk tolerance, you’ll be wrong. You can’t know until you’ve visualized losing money intensely, or ideally, actually lost money.
Think you can handle a 30 percent drawdown? You’ll almost certainly feel uncomfortable at 15 percent,
losing sleep, wanting to override your strategy.
When the market crashes, advisors will say: “Yeah, you’re down 45 percent, but the index is down 56 percent! We’re actually doing well, relatively. The market will go up long term, and you’ll make your money back.”
They’ll tell you, “You just have to deal with this.” They make you believe that it’s “part of the game,” that this is normal and happens to every investor.
The truth is of course, you don’t have to deal with this, because your money should have been out of the market.
Big firms favourite saying is , “The market always goes up in the long run.” But as anyone who has witnessed the market’s multiple crashes knows, the market inevitably
sees big drops, and it doesn’t always recover.
This was exactly the case in both 1929 and 2008, and the results were disastrous. The 1929 crash led to a bear market that continued until 1932. If we assume that people started to invest at the equity high (~380),
they would have seen a drawdown of 88 percent, and
@theBuoyantMan These are few harsh realities
1.The moment you took a loan, a lumpsum of interest+ principal is calculated and whatever emi we pay is reduced from total (technically only interest) so that prepayment doesnt affect banks. for eg
principal=100 and interest =100 for 10 years with
@theBuoyantMan 20 per year emi. if you repay 100 rupees in first year, we think bank reduces from principal too. but no they calculate as 200-100=100 still pending from customer. in short never prepay loan !
2. never pay emi on last date. pay 1 week prior. even if you pay emi and due to some
When it comes to exits, all traders fit into one of two camps, fixed target or trailing stoploss.
The easiest way to determine which camp you fall into is to think about your answer to this question
Is it more important for you to have a high win rate ?
or
is it more important for you to have huge winning trades?
A tight stop will produce whipsaw losses in trading ranges. Even though each loss may be small,the sum of a series of losses can be larger ! However a trending market will rescue a system with tight stops and results are astonishing.
