In my recent Corrections Are Healthy post, I reference Rudyard Kipling's poem 'If'. I mention that the segments from the poem that resonate the most with me are:
- If you can keep your head when all about you are losing theirs
- If you can wait and not be tired by waiting
After publishing that post on March 13, 2025, we have witnessed very interesting market conditions.
Some investors have panicked. Recent market conditions, however, require a level head.
Tune Out The Noise
One of the worst things we can do is to spend an inordinate amount of time on social media. Quite often the material posted on various social media sites is from people where thinking is not their strong suit.
If we spend too much time fixating on ‘noise’, we are apt to second guess everything. Lose our sense of self and we forget WHY we started investing.
I started investing in equities in 1987 and have made more than my fair share of mistakes. Over the years, however, I have come to the realization that temperament far outweighs intelligence. Everyone appears to be an ‘investment genius’ in a bull market. When market conditions turn ugly, however, our conviction starts to crack.
This is not necessarily because the companies in which invest has changed. The cracking typically happens because we start to drift from our original underlying reasons for investing in them.
Once we move away from long-term thinking to frequently monitoring intra-day share price behavior of our holdings, it becomes increasingly likely that we will make investment decisions at the most inopportune time.
We need to understand investing is not about being right all the time. It is about keeping our wits when the short-term is ugly.
No matter how much research or technical knowledge we bring to the table, the key is to be resilient.
Chasing investment ideas that do not align with our investing philosophy and exiting investments too early/too late will inevitably happen. This is all part of the financial freedom journey.
Mitigating the risk of making unwise decisions requires us to have a deep understanding of who we are.
Typically, the most successful investors are comfortable with ‘silence’. They do not have the need to continually act/react. They silently build strength by trusting themselves when it matters most.
Final Thoughts
We often fail at investing because somewhere along the way we lose our sense of self. We don’t fail because we are not smart enough.
If you are experiencing a rough patch in your financial freedom journey, rest assured that what you are experiencing is part of the process. It is not an indication that you should give up but rather it is a signal to revisit your investing principles. Remember why you started and who you are.
The real art of investing is not being the ‘world’s best investor’. The real art of investing is learning how not to be beaten by yourself.
NOTE: These comments do not apply to people looking to capitalize on short-term share price behavior. Anybody who invests solely on short-term share price behavior is gambling; using the term ‘investing’ is inappropriate.
I wish you much success on your journey to financial freedom!
Note: Please send any feedback, corrections, or questions to [email protected].
Disclaimer: I do not know your circumstances and do not provide individualized advice or recommendations. I encourage you to make investment decisions by conducting your research and due diligence. Consult your financial advisor about your specific situation.
