Friday, May 04, 2007

Fixing one's mistakes

There should be an important period, it occurs to me, in life of every investor (with the exception of unbelievably lucky ones), when a brutally honest analysis of one's flaws is performed. Take this week: I did not act on some stocks that would have paid off big, and I only acted on stocks that resulted in "portfolio" gain of less than 0.5%. The question that remains is, why? Of course this diary is not a sufficient recollection of why I made this or another decision.

I think one needs to spend much more time to learn what desisions where made, why, and only then one's character traits that act as obstacles on the way to higher returns could become apparent. I may improve on that right here and now, with exception of the fact that those decisions that I did not make, I would not recall reasoning behind.

I realize that emotional nature of my investment decision-making is a severe deterrent... And I can see that greed and refusal to accept mistakes are right there, front and center. I was (and still am) so sure that my picks must perform much better than they do, and I refused to sell them for what they were worth.

I need to keep more detailed record of my indecisions and after the fact perform comparison of what is vs what could have been. If only I had time... It's so much easier to frantically navigate from one chart to another and try to predict where the curve would lead and how that curve will make me rich.

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