No more monthly updates on investment performance



After long thought, I have decided to stop monthly updates on my investment performance, at least for a while.

There are many reasons for the same. Certainly one of the practical reasons is that I was spending way too much time on updating and refining my spreadsheets, neglecting more essential things. The other was that I was almost reviewing my performance on a minute to minute basis, and I think that that kind of obsessiveness results in too much activity on the stock markets. It is better not to know every minute what your performance is. The third reason is more nuanced. If indeed, I am a long term investor, why am I worried whether I have beaten the benchmarks daily, weekly, monthly or trimonthly. I should take a view on a stock at a particular price. If the price falls, I should buy more. Then I just need to review the performance every year, and try to beat the benchmarks every year. This is because my one and a half year’s intense experience has taught me that a) Markets often get it wrong in the short run and b) that momentum traders sometimes trade up a stock excessively, or sometimes punish a stock unreasonably. Momentum trading may be profitable for the people who practice it, but I cannot see myself trading solely on price, without any fundamental backing.

If markets do get it wrong in the short run, then why worry about performance in the short run. I should only worry about performance in the long run. And this is what I intend to achieve by not keeping on comparing myself to benchmarks.

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