A note to my future self—the one who might be panicking during a crash or getting a big head during a boom.

We often hear the saying, “The stock market is a form of spiritual discipline.” But for most of us, it’s less about Zen and more about a severe case of “investment schizophrenia.”

If you look back at the 2000 Dot-Com Bubble or the 2008 Financial Crisis, countless investors kept repeating the same tired script: They got greedy when they should have been terrified, and terrified when they should have been greedy.

I’m writing this down as a permanent reminder to my future self: When the market starts swinging wildly, don’t fall into the psychological trap that 70% of people do—the endless flip-flop between the “Cocky Gambler” and the “Defeated Student.”

1. 🚨 Watch Out for the “Bull Market Gambler”: When I think “Buffett is Overrated”

When your account balance is constantly in the green and your net worth hits a new high every day, you need to seriously watch out for that “Gambler Persona” whispering in your ear.

The world suddenly looks perfect: everything you buy shoots up, and all the news is fantastic. That’s when a dangerous illusion creeps in: “Maybe I’m actually a genius? Buffett only makes 20% a year, but I pulled 50% this month! Is his old-school stuff even relevant anymore?”

Remember this:

  • That’s the wind, not your wings. Most of your profit in a bull market is $\beta$ (Beta) return, which is just the market rising, or “a rising tide lifting all boats.” You made that 50% because you were standing in the wind tunnel, not because you suddenly grew the ability to fly.
  • Never confuse luck with destiny. The worst thing that can happen to a gambler is winning the first few bets. If you pat yourself on the back for winning a huge, risky bet, you’re just reinforcing a wrong idea in your brain. This “mysterious confidence” will make you bet even bigger next time, until you give back everything you earned, plus your original capital.

A Warning to Myself: The moment you start looking down on conservative, long-term investors, and when you think risk management is for cowards, your mindset has already crashed, even if your account hasn’t. As soon as the tide rolls out, you’ll be the one swimming naked.

2. 🆘 Saving the “Bear Market Student”: When I want to Sell Everything and Swear Off Stocks Forever

When the cycle flips, a black swan lands, and your account drops by 30%, 40%, or even 50%, a different personality takes over—the “Defeated Student Persona.”

Like a student who fails test after test, you’ll fall into a deep state of Learned Helplessness. You’ll start beating yourself up: “I’m so stupid, I got greedy,” “The stock market is a scam,” “I’m done with stocks, I’m taking the rest of my money out and putting it in a savings account.”

This is the exact feeling at the market bottom in 2008. But you must remember: this is the moment that demands the most courage.

  • A loss is a cost, not a sign of incompetence. How can you run a business without buying inventory? A temporary paper loss on a stock is just the “inventory cost” you pay for potential future returns. As long as the logic of the asset you bought hasn’t changed, its value hasn’t changed either.
  • Don’t chop down a tree in the winter. Students fail because they lack ability, but the stock market crashes mostly because of emotional collapse. When others are in peak panic and throwing in the towel (selling at a loss), that’s usually when assets are on the deepest discount.

A Warning to Myself: If your immediate feeling after a huge drop is “shame” and “I need to run away,” instead of “excitement” and “I need to look for gold in the wreckage,” you have completely wasted a crisis. The real transfer of wealth always happens at this exact moment.

3. 🤖 Becoming the Third Person: The Cold, Hard Probability Manager

To survive in this brutal market, I need to kill both the “Gambler” and the “Student” inside me. I must become an Operator.

  • How to Handle a Bull Market: Be extremely humble. Acknowledge the role of luck, and constantly ask: Is my profit based on taking on too much risk? If the market crashed tomorrow, would my investment logic still hold up?
  • How to Handle a Bear Market: Be extremely rational and cold. Strip away all fear and focus only on valuation and probability. If a great company is trading at a 50% discount because of panic, I need to be the buyer, no matter who is selling.

Final Takeaway

Future me, whether you are currently feeling high as a kite looking at your double-bagger account, or sobbing while looking at your position that’s been cut in half, please come back here and read this one last sentence:

Don’t look for validation in good times, and don’t look for defeat in bad times. Be a cold-blooded killer who is accountable only to “value,” and never pays the price for “emotion.”