You’ve read that correctly: up 35% year-on-year on my whole portfolio. The S&P 500 is up 27% YoY. I’ve beaten the market. I should feel happy, accomplished, and whatnot, but I’m not. Why? Because any fool can ride a bull market and even beat the “index,” but almost no one can do so consistently over the long term.
Hence me writing about investing on my blog and doing my best to present the lessons I’m learning as time goes by. In 2021, I invested in Tesla and lost almost half of the money I put into it. A while later, I invested in Luminar (LAZR), and it went to zero alongside close to a third of my portfolio.
How many losses can anyone stomach without actually starting to think more deeply about what the hell they are doing? It turns out that people will continually do this and relive their own hell on a cyclical basis. Once you take part in enough meetings with other investors, follow enough podcasts, and read enough forum posts, you start to see that most people simmer in their own pain for many years without any direction.
This is why, even though I worked hard to achieve this 35% gain, I must remind myself to focus on the process more than the outcome, as Annie Duke says.
The process of investing—that is something I control. Where the market goes, and therefore the stock price of my holdings—that is out of my control. Imagine what a situation like this does to people’s brains, to their psyche: you can do everything right and still lose big, and this can happen over and over again. Definition of insanity, much?
I will write articles here that I would have liked to see when I was just starting out. Terms like “long term,” “stock,” and “stock market” have well-known definitions, but you won’t find the simplest possible explanations in many places. I’ve read tons of investing books, and they all have certain assumptions—even the basic ones.
My autistic brain falls through those cracks, through those assumptions, and that is why I am slow to pick up any new domain. This is why I spend an inordinate amount of time reading, experiencing, and learning about a subject until I feel I truly understand it. By the time I’m done, I can happily say that I understand that subject better than the majority. It’s the same with investing: I’m in a continuous process where I ask the questions people feel too ashamed to ask because they seem too basic. I’m not afraid of simple questions. I’m afraid of entering a domain and tripping over random obstacles because I didn’t ask those simple questions.
Why is being up 35% “nothing,” as per the title?
Because context matters a lot. If you achieve 35% returns for many years in a row, then there may be some skill there. “Long term” means at least 10 years—just about enough to go through maybe 1.5–2 economic or business cycles, along with some market corrections. If you can achieve that kind of return through several cycles, then yes, you can say you did well.
In my case, it’s 35% in a crazy bull market where loads of other people buying small caps, like I did, were up 50–70% on their portfolios during the same period. The S&P 500 was up 27%, and most passive investors didn’t have to do anything other than keep adding to their funds.
Do I look that smart now that I’ve given you some context? No. I was a bit lucky and a bit cautious.
This is what I’m writing about on this blog: context, basic questions being answered, my ideas put out there, and then getting people to critique them, expose the flaws in thinking, and hopefully improve my actions as time goes by.
I’ve read 200 books from many domains just to get a glimpse of what this stock market thing is over the last five years. I’m not going to stop reading, and I’m going to continue testing and learning how to invest.
I know that I did 35% YoY because I am writing a personal investing journal, a physical one where I gather my thoughts and actions. But about that at a later time. Until then, enjoy the bull market because I’m all in cash now waiting to finish my yearly rotation.
Yes, I’m crazy because I’m doing my own thing.