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| Monday, October 01, 2007 |
| Optimism just isn't good news |
Sages say that feeling optimistic is often essential but in the context of the stocks market, it is more of a bane.
Rewind towards Late January, at that point of time, people were predicting markets to hit unbelievable levels and when CNA and SI forums were covered with unneccessary praising of experienced investors, "Wham!" the correction came. Finger pointing began and it lasted awhile. When things calm down, people are at it again, singing praises of good calls etc. While I do believe that those who share selflessly should be appreciated, complacency sets in. In July 2007, I reached an all time high of 70++% returns. For the first time, I felt proud because while famous investors averaged 25++% p.a, I manage 70+%. haha. That proved to be all wrong! The price shock came awhile later, and it hit my selling trigger. Yes, everything was under control and this scenario is still much better than my worst case scenario. Then a mindset started to crawl in. "I had winnings, so might as well go in again and buy on dips" But then, this isn't in my protocols for buying. And I made a huge mistake. Maybe its coincidence but weeks later come the correction.
After the correction, I told myself not to be happy by paper profits. They are just paper profits. I will only be happy when I liquidate everything, which is unlikely as there will always be trends elsewhere. Furthermore, my reminder of my unneccesary loss is still pasted near my study table to remind myself that it just takes ONE blunder to ruin everything.
Right now, things seems rosy, but to me, this is just a phase of bullish sentiment. If you guys are still not vested, I urge you all to invest with caution. Sentiments change quickly with huge macro news.
But in this short post, optimism might push prices, but as an individual, dont be overly optimistic. Must always try to treat a 15% gain and a 15% loss equally. Until we attain that, we can be a rationale trader/investor |
posted by Nenix @ 5:25 PM   |
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| NenixDreams Fund |
| Fund launchprice on 1st August 2006= $1
Target for 2007 = Beat STI index
Current price of NDF as of 1st Oct 2007 = $1.58
Current price of STI as of 1st Oct 2007 = $1.54
Difference with STI index is 0.04
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