In Your money and Your Brain, Jason Zweig described an investor who sold all of her stocks and bonds into cash whenever she goes on vacation, and move everything back when she is back from vacation. The investor says, “That way I know I’m in charge while I’m on vacation, and I can relax instead of worrying that I might lose money.”
The author described the inventor as being suffered from “the illusion of control”, the feeling that one can exert authority over random chance with our physical actions. (This reminds me of the book Fooled by Randomness)
The Mamak Stall Investor is going on vacation too. He is not going to do anything to his portfolio: no selling, no buying. He says, “That way I know I wouldn’t be subject to emotional roller coaster while I’m on vacation, and I can relax knowing that there wouldn’t be any surprise because my indexed portfolio will behave just like how the markets behave.” Will there be year-end stock rally? Will there be more bad news from the finance sector? “I don’t know, I don’t care“, he says.
Merry Christmas and Happy New Year to all of you!