Thursday, October 4, 2018

Loss (of profits) 損失 , 손실

Another example of Chinese, Korean, and Japanese all aligning on a word: this time it's "losing money," which is what happened today in the stock market to everyone.

The first half of the year saw many days like today of big losses (but also days with big gains to offset those losses) due to increased volatility, so I and many other investors I imagine got shocked into backing out of the market. It hasn't happened as much in the 2nd half of the year, but when it does happen, it still has the same painful effects.

The anatomy of a losing day with stocks:

1.) Wake up, check the futures market. Not looking like it's a great day, the futures already down.
2.) The market opens for trading at 8:30AM, not too bad, the Dow's been up for 3 consecutive days so we're due for a bad one.....just hope it's not too bad?
3.) The first hour of the trading is usually the most volatile as the traders all get their orders in, and the market seems to be OK and settling in.......
4.) But then it goes down, and goes down fast. There were actually some gainers in my portfolio earlier in the day......not anymore. Those get dragged down with the rest of the market
5.) inevitably, there's a report that explains today's extreme losses....interest rates, fears in the market, vague notions about a lingering trade war, etc., etc.,
6.) As some point I BUY Nflx because it's down quite a lot already today.......so I think. It rebounds after I buy it, but then panic sets in when there's a .....
7.) DOUBLE-dip in the stocks and everything keeps going down, and it's officially a -2% dip with my stocks, which is a LOT for any portfolio to take.
8.) Externally I act cool, but internally I start fretting over the money I've lost on the day (how many days/ weeks? salary I've lost just in today's trades alone) - I never do this when I gain money, I guess because making money is the expected result in investing, losing money isn't. I wish the only 2 options in investing was a.) static quo or b.) make a tiny bit of money, I would sleep a lot better knowing that.
8a.) I get the most basic lunch to "punish" myself for having a bad day. Perversely, this is how my mind works, as if saving the $2 for extra avocados will save my portfolio. When I have a good day on the stock market, I do "splurge" sometimes. So I guess it could even out.
9.) I wish I'd made better life decisions early in my life to make more money! The bad stock day starts bleeding into other sectors of my life of "Why didn't I accept that full-ride scholarship to law school! I could have made so much money!" or "Why didn't I invest and go all-in on the market in 2011 when I could have made hand over fist in investments!" - so many questions, so few answers.

10.) Finally, mercifully, the trading day ends and usually there's a little bit of a rebound in after-hours trading to prevent me from beating myself up even more......plus traders usually have a tiny bit of a buyback on really bad days in hopes of getting ahead of a rebound tomorrow. That's the thing about stocks: there's always tomorrow. Well, except on Fridays, but it's just a short weekend away. Tomorrow, tomorrow, I love you tomorrow, you're only a day away.

The lesson: don't look at the stocks too much over the course of the day, they can consume your attention for most of the day, especially when they're down and you start counting pennies in your bank account. And personally i start losing fingernails as I bite on them nervously. And the stock market is not a microcosm of my life, stop comparing movement in stocks to everyday life, like I need to compensate for each dollar gained or lost in the stock market to real life.

Fantasize on,

Robert Yan

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