FYI: At some point in investing, everyone is not just wrong; we're stupid. The real question is, how long are you willing to stay with a trade if you're sure you're right?I bring this up after attending the 14th annual MIT Sloan Investment Conference last week, where I moderated a few panels. Various participants owned up to feeling pretty stupid. The explanation offered was that being wrong, at least temporarily, was an integral part of the job description for many in finance.
This is much more than simple recency effect, or the tendency to give undue weight to recent events Yes, 2018 disappointed, with all major asset classes performing poorly. If your primary goal was to avoid looking dumb, you probably didn't succeed, unless you sat in cash all year. And as history informs us, holding cash makes one look foolish much more often than not.
Regards,
Ted
https://www.bloomberg.com/opinion/articles/2019-02-25/stock-market-makes-everyone-look-stupid-at-some-point
