Since Monday evening, this week has been horrible for me in terms of how much crap life can hand over to someone in such a short amount of time. I don’t know how people tend to look at stuff, but right now, to me, it seems that getting your dreams crushed is far more depressing than any amount of financial loss. I am ready to give every penny I have to get back what I lost - but it doesn’t look like that’s going to happen.
Anyways, without making this a morose platitude, let me come to the point. Here are a few parallels that I have been drawing between life and stock markets - almost in a way as to comfort myself in this chaos.
- In general, there are these daily ups and downs, there are these rare black days, and there are these occasional fears of recession; but on the whole, the hope is that things will tend upwards in the long term. So, it helps to not look at the daily volatilities and to focus on a 20~30 year perspective. For me, it has been nothing short of a melt-down for the last couple of days - but I am going to stick to my “hold” strategy (I am talking about life), think long term, and hope for better times ahead.
- In life and in stock markets, smart decisions can help accentuate success and mitigate failure, but there are days of profound realization when the randomness becomes quite apparent and success becomes a game of probability. Makes us acknowledge a multitude of factors, beyond our control, that can affect future outcomes.
- At times, we regret our past choices - “I wish I had that winning one” OR “I wish I didn’t have this losing one” - but no amount of regret can reverse what has already been done. The only thing you can do is to take it easy and think in terms of the future prospects.
- Just like people start wondering whether their portfolio is balanced enough for their long term goals - right when the market hits the bottom - the last few days have made me contemplate on some balancing aspects of my life’s portfolio - why am I doing what am I doing and how am I doing it. Although I understand that, just like in a stock market, a depression is a bad time to rebalance one’s portfolio (think impulsive decisions), the very fact that I became pretty uneasy over these recent unpleasant events tells me that I probably didn’t have all the right equations to begin with. Rebalancing seems to be in order once the dust settles on the present issues.
- DIVERSIFY -your dreams, your ambitions, and your approaches (think backup plans). Banking too much on any given aspect of life with a narrow focus is like betting all your money on WorldCom. Unfortunately, we become so cozy with specific things that work for us, that the importance of diversification is not felt till we sense the threat of an impending disaster. And usually, it’s too late by that time to do anything about it.
All said and done, for now, all I have to do (rather, all I can do) is focus on the big picture, suck it up, and give a fight till the good times return.
Unfortunately, there is no Federal Reserve for life that can boost your confidence by tweaking some interest rates; probably that’s why life’s a beach while the stock market isn’t.