Moment of reflection (Kyoka Suigetsu)
Moment of reflection (Kyoka Suigetsu)
I have been on a 6 months haitius from blogging to deal with some personal family issues, and also made an active decision to pivot myself to change my lifestyle hobbies and habits. Those personal issues heavily affected my ability to allocate capital. Heeding the lessons from the greats like (Bill Ackman and Warren Buffett) whom made bad decisions under emotional turmoil and trauma, I took an active decision to reduce any active investment decisions for now and deep dives to a bare minimum and decided to DCA into my higher conviction ideas and <Diamond hands> into the positions I already decided to maintain for the next 3-5 years.
The bloodbath from the equity markets is taking a toll on my work, personal investments, and emotional front. Some of the investors I greatly respected also took great hits to their portfolio, and even FIRE success stories such as Tree Of Prosperity renounced their old ways and started looking for active employment. For several fleeting dark moments, I was pondering whether if the FIRE movement is just a form of escapism, to give me hope in the endless hours of office grind and politicking. But in the grand scheme of things, I firmly believe this is a passing (but excruciating) phase, and I can still live and recover to fight another day.
Youth was when I believed that as long as I put in the effort and follow a magic formula / copy the best investors / study the technical skill-sets propagated by the CFA, I will achieve success in my investment results and can get FIRE before FIRED.
Maturity is when I realized that even the best investors get blown up by the most unforeseeable risks, and even experienced bloggers / influencers make bad mistakes in various stock picks / asset classes all the time. What is propagated louder by the more outspoken isn't necessarily the most true, and even credible names can be bribed as a shilling mouthpiece for more deep pocketed agents with nefarious motives.
As an INTJ, I pondered over the risk reward of dedicating so much time and effort in essentially a lonesome intellectual activity, when the results might not necessarily beat an low cost SandP500 index fund. Even in the best laid research and plans, the results of your methodology is only make known a few years / decades out. A lot of the process comes down to faith, that the process is sound and the results will follow. But no one can ever guarantee the outcome.
People around my age are getting married and having kids and starting their own families, and even old friends become low effort / drift apart and become strangers over time, which is something I am struggling to come to terms with. Covid and CFA ravaged a lot of my personal relationships I nurtured from the toastmasters and whatsapp groups I had. To start afresh, I decided to make an active effort to rebuild what I have lost, and go on meetup activities and experiment with new hobbies to try to become a more sociable / extroverted version of myself.
Thoughts about the FTX (SamBankmanFried => SammyBoyForum) debacle
As Temasek wrote down its 275M investment in FTX, the common theme about the situation is that how did <The Smartest Guys In the Room> got it all wrong. As an unfortunate investor in coinbase (As a Mental writeoff position), I can understand TH viewpoint in venture capital bets. But losses are never easy to stomach.
Coinbase is essentially a pure safekeeping broker-dealer exchange which essentially allows the buying and selling of crypto asset classes, and charge a safekeeping fee to safeguard the client money and its assets. I designated it as my main exposure to crypto, with strict portfolio limits as a less risky way to profit from the volatility of the asset class. A potential secular decline in the asset class is the key threat to my investment thesis, which I have no insight as of this moment.
FTX is more of a prime brokerage service whereby other than custodian services, they have an integrated proprietary hedge fund whom does active bets in derivatives and venture capital bets. Despite the pedigree of personal, they had huge conflict of interests with regards to the interpersonal relationship between the top management, failure to keep proper books and records and accounting entries, failure of basic controls like segregation / protection of client money assets, and deliberately use of loopholes and back-doors to siphon client money from their clients (Saving account product structure) to fund the proprietary bets of (Alameda Research Hedge fund). The drama and scandal is still unfolding with a lot of politicking from SBF competitor CZ. I am pretty sure this scandal will go down in the books of financial history as one of the most ridiculous bubble, bribery and crony politics, and failure of regulatory actions of all time.
I do not have a firm answer to a lot of questions in life, whether may it be the investment front or personal front. I still believe in the important of keeping proper books and records of my transactions thesis and decisions. But because of the sheer time and effort in creating a blog article from scratch, I will space it out on an indefinite basis as I do not see a monetisation avenue from my blog. Until then, I will try to persevere through these dark moments and have faith that everything will turn out alright eventually.
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