Who wants to see investment losses?
I tell you, put on your sunglasses!
Are you unable to see your investment losses when you close your eyes?
In the process of investing, it is very difficult to see the decline of your investment target, not only because of the torment of the process, but on the other hand, investors are often at this point in time, because of their emotions, it is easy to do some unexpected things things that often make you regret. As long as it is a human being, the feeling of loss is greater than the feeling of gain. Therefore, how to reduce the frequency of seeing losses is a question worth exploring.
The more frequently you look at your investment performance, the more likely you are to see losses.
Assuming we have a 60/40 stock-bond portfolio, you can see from the animation below, looking at the results of the performance over different time periods, the losses (red lines) are different.
Below are the odds of seeing losses over different time periods
- Daily Views: 46%
- Monthly Views: 36%
- Quarterly Views: 33%
- Yearly Views: 26%
If you check your investment portfolio every day, then you are almost twice as likely to see a loss than once a year! You are smart, you should have discovered that, in fact, this also echoes the length of the investment cycle that we often say, time stretches Longer, the higher the probability of rising, which is exactly the reason.
Therefore, not only can you lengthen the investment cycle, but if you can also lengthen the frequency of checking, you will have more confidence in sticking to your investment plan.
Come on, put on those so-called frequency-reducing sunglasses!
Reference: how-to-improve-your-risk-adjusted-returns
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