Money and Finance
One of my high school basketball coaches was a real nightmare. Any mistake you made on the court -- an errant pass, a weakly-set screen, a poorly chosen shot -- quickly landed you a spot on the bench, followed by a rather loud commentary detailing exactly what you did wrong.
- Broyhill Asset Management: Put Me In Coach!!
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- The No-stats All-star - By Michael Lewis
This story reminds me of the quote, "There's no limit to what a man can do or where he can go if he doesn't mind who gets the credit." -Battier’s game is a weird combination of obvious weaknesses and nearly invisible strengths. When he is on...
- Mark Sellers: Rational Investors Should Rejoice
Two months ago in my Financial Times column, I listed some of the things I have learnt about the stock market over the years. I likened the market to a game of online poker, with anonymous opponents and continuously evolving probabilities. I received...
- 6 Signs Of A Good Investment Process
In my baseball-playing days, I was on the mound in a big playoff game, and at a key moment in the game I threw what seemed to be a good pitch, only to watch as the ball sailed over the fence for a home run. It might still be traveling somewhere over North...
- Make The Most Of Your Investing Mistakes
Like most people, I don't like being wrong. Trouble is, I'm wrong quite often. To err is human, after all, and I've come to accept the fact that I'll make incorrect choices in the course of everyday life, such as the time I was about...
Money and Finance
Don't Let Mr. Market Be Your Coach
One of my high school basketball coaches was a real nightmare. Any mistake you made on the court -- an errant pass, a weakly-set screen, a poorly chosen shot -- quickly landed you a spot on the bench, followed by a rather loud commentary detailing exactly what you did wrong.
In contrast, my baseball coach that year was incredibly positive about everything. If you got a simple base hit, he made you feel like you hit a home run. Made a mistake? Don't worry about it. Even if we had a bad game, he would focus on what we did correctly.
Like my coaches, Mr. Market also provides feedback. Depending on how he's feeling at the time, however, he can either make you feel great or downright rotten about your investment choices.
During the financial crisis, the feedback we received was a lot like that of my terrible basketball coach. For a while, it seemed you couldn't do anything right and many investors simply preferred to sit on the bench.
In times like this, however, market feedback is extremely positive. Any move you make -- whether it is smart or not -- will most likely be rewarded, so it's natural to want to get back in the game.
Don't let Mr. Market be your investing coach. His advice is fleeting, after all, and can lead to poor decisions. Instead, be able to step away from market feedback and be self-critical in bull markets and self-assuring in bear markets. You're never as good as you think in a bull market and never as bad as you think in a bear market.
Stay patient out there.
Best,
Todd
@toddwenning on Twitter
Stay patient out there.
Best,
Todd
- Broyhill Asset Management: Put Me In Coach!!
Coach is a classic compounder, not to be confused with certain pyramid schemes, selling magic weight loss potions and masquerading as growth stories. From 2002 to 2012, the company's sales increased at a compound annual rate of 21.1%, while earnings...
- The No-stats All-star - By Michael Lewis
This story reminds me of the quote, "There's no limit to what a man can do or where he can go if he doesn't mind who gets the credit." -Battier’s game is a weird combination of obvious weaknesses and nearly invisible strengths. When he is on...
- Mark Sellers: Rational Investors Should Rejoice
Two months ago in my Financial Times column, I listed some of the things I have learnt about the stock market over the years. I likened the market to a game of online poker, with anonymous opponents and continuously evolving probabilities. I received...
- 6 Signs Of A Good Investment Process
In my baseball-playing days, I was on the mound in a big playoff game, and at a key moment in the game I threw what seemed to be a good pitch, only to watch as the ball sailed over the fence for a home run. It might still be traveling somewhere over North...
- Make The Most Of Your Investing Mistakes
Like most people, I don't like being wrong. Trouble is, I'm wrong quite often. To err is human, after all, and I've come to accept the fact that I'll make incorrect choices in the course of everyday life, such as the time I was about...