141 | That’s Impossible!

How is that even possible?

One explanation is panic in market-wide downturns.

One explanation is complete naivete.

But those seem too obvious and too far out on the tails of the bell curve.

I think the real killer is using past performance to pick your strategy.

“I don’t have a clue what to do, I guess I’ll just pick the one with the highest returns.”

“That fund or strategy has crushed mine for the past 5 years, let’s move some dollars to it.”

“I’m going to wait to invest until the market settles down*.”

I have heard these things from too many people to count and have even personally felt the urge, which leads me to believe that doing them over and over again is how it’s possible.

*Waiting “until the market settles down” is the Muggle’s way of saying “I’ll invest once I have seen the market go up”. And yes, if you’re correctly thinking that sounds like an oxymoron, then you’re probably not a Muggle.

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142 | Abstraction At It’s Finest

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140 | The Millennial’s Dilemma