Love and the stock market
The stock market is a place driven by emotions. If you look at the charts, you will realise that there are peaks and troughs. All relationships have its ups and downs that good couples weather through. However, in the stock market, the experts have discovered ways to take calculated risks and some even try market timing. In a relationship, are there lessons we can learn from the stock market and therefore, minimise our risks of getting hurt ?
When I look back at my relationships with men I dated or had long term relationships with, I do believe there are some lessons in the stock market that can be relevant to male and female relationships. To elaborate on all the lessons will take an entire book!
Euphoria is a sentiment we commonly associate with in a Bull run in the stock market. Many investors find it hard to stay out of the market when the market has reached a significant peak or a higher high. Driven by greed, they often put themselves out in the open and expose themselves to the downside risks of the market. Good investors will often look at the charts and adopt various tools to calculate their market risk before putting themselves out there. In a relationship, do we look back at how our potential partners have handled their relationships and assess the risks of being hurt? Do we then rate them in terms of risk levels and therefore take the safer options. I believe in most cases, love is blind. Even if the charts or past history of your beloved tells you that he is not a good partner, one may still take the gamble and plunge into the relationship. I think this is not wise. Some people do not change their behavior and will continuously hurt their loved ones unintentionally. It is habitual and one cannot expect the other to change when it is their trait.
In the stock market, a good investor is disciplined. If the market tools and charts shown significant downside risks and little upside, they stay out. If they do choose to get into the market at the later stage of a bull run, they practise their stop losses. In a relationship, do we know where to place our stop loss and more importantly, are we disciplined enough to execute it? After my first failed relationship, which was the most enightening of my relationships, I have learnt to handle my emotions better. I look for security in relationships with dependable individuals and when I get too euphoric about the entire relationship, I often spend more time reflecting on it. Assess my next move and level of comfort.
Once I assess that the other does not have the prerequisites for a good lasting relationship, that is my stop loss, I get out. Once I get out, like any investor, I get over it. I will never look back. I probably will 'invest' in the relationship if market conditions have changed and potential returns can be reaped. The best kind of chart to resemble a good relationship is one that continuously goes up despite the little 'noise' or problems in a relationship. One, that steadily improves your wealth or in a relationship, one that steadily increases your happiness and confidence in that relationship. I do not think investing in securities with big cycles is for the faint hearted. In a relationship, one should avoid such relationships unless you can be very casual about it. Hopeless romantics should never expose themselves to such risks. Slow and steady is the way to go. If you like excitement and are willing to take the risks, make sure you have a stop loss and follow through. Poor investors keep adjusting them lower! What is the point of having one in the first place you ask? In a relationship, do we do the same and never get out just because you think it could have been worse and therefore, whatever is happening to both of you is not that bad? Mistake!
Some experts enjoy value investing, others enjoy momentum investing. While I do practice both, I know value investing in relationships is the way to go. In fact, it is the only way to go. But it is not that exciting. No one should ever practice momentum investing in relationships. The goodness of that relationship never lasts and don't think it is good just because it was good at one point in time. The biggest mistake one can make is to think that that goodness is going to go in only one direction, up! They are totally not prepared for the pitfalls. If you enjoy the roller coaster ride of relationships because you enjoy the significant highs, then make sure you have a really significant stop loss so that you will hardly hit it. Otherwise you will be going in and out of relationships, what a waste of energy. That is exactly what happened to my friend, Tim. He went into such a relationship, and at last, he hit his stop loss and he got out of it. Frankly he should have raised his stop loss as it would have saved him the heartaches!
How about me? Am I practising what I write here. Yep. I think I have grown up and am tougher than I used to be. So guys who aren't worth my time, won't see me after two months. That is where I placed my STOP LOSS.
