One time, I lost 15%.
Instead of doing what a clear-minded trader would do (cut losses, go out for coffee), I think I’m smart enough to 'make up for it' right away.
I don’t understand why, but when I look back at it, I see:
This mistake will disappear if I create a bigger mistake.
Like how a stain on a shirt can be hidden if I… pour more coffee over the entire shirt.
And so, from an initial mistake, I became an excellent screenwriter for the multi-part film titled 'Self-Destruction'.
Charlie Munger once said:
What’s important is not to avoid all mistakes,
but to not let a small mistake turn into a domino effect of emotions.
In other words:
Losing one game is not scary.
What’s scary is losing one game and letting my ego write the script for the next five losses.
In my mind, this always appears with an image: a guy driving off course.
Instead of turning on GPS – which a normal person would do.
That guy keeps running straight into the wrong direction.
Why?
Because I’ve already wasted 20 minutes going off course. Another 40 minutes probably won’t hurt.
Better to go wrong than… lose face.
The first mistake rarely has enough power to take me down.
It’s the unconscious reaction to it that is the knock-out.
There was a time I invested and lost.
Instead of sitting down, calmly observing the market and myself, I choose to rationalize my emotions:
"It’s not that I’m stupid. It's just the market is crazy."
And I hold the order.
Lose a little more.
I still refuse to stop.
Cutting now is like admitting I’m really stupid?
So I opened another new position.
Hoping to make up for it.
One mistake leads to another mistake.
I’ve written myself a 'self-destruction' story… very reasonable.
Having gone through enough silly times like that, I draw a simple conclusion:
Wisdom is not about never making mistakes.
But knowing when to stop.
Knowing to break the chain of mistakes – right when my hands are still shaking.
The moment I’m clear-headed enough to ask myself:
"Hey, are you correcting a mistake,
or are you soothing that tiny ego inside?"
That’s when my inner defense system… starts to kick in.
I don’t dare say I’m good at this.
Some days are fine.
Some days I trip.
But now, every time I trip, I try to keep a small ritual in my head:
"If you make one mistake, OK – I forgive you.
But if you keep making mistakes,
then this time it’s your choice –
you can’t blame anyone."
And I think:
Learning not to become my own next chain of mistakes
is perhaps one of the most important life skills
that I’m practicing – day by day.
***rewritten from note 24: Avoid complex mistakes
