In their recent episode of the VALUE: After Hours Podcast, Cassel, Taylor, and Carlisle discussed Avoiding Social Media When There’s Panic In Markets. Here’s an excerpt from the episode:
Jake: [crosstalk] I think it’s very insightful there with the short-termism that creeps in, because I think as you’re taking this quotational pain, you start to not want to see that next print. The next quarter, you’re like, “Oh, God, I almost don’t even want to see it.” There’s so much uncertainty about like, “Is this going to be a landmine that just completely explodes it.”
When you know that that’s lurking, that uncertainty is incredibly agitating and you’d almost rather– We’ll get into this when we get to the dopamine stuff, but there’s a difference between risk and uncertainty when it comes to dopamine. We find actual risk-taking often like you get a dopamine hit from it, but uncertainty actually turns that off and we find it agitating.[giggles] I think that you said something very smart there that short-termism now is, like, you’re looking into that next quarter. I don’t know if you felt this way when things were going up, but you look forward to that next quarter, because you’re like, “Ah, I think this company has been killing it. I can’t wait to see the numbers.” Now, it goes, it flips completely in reverse and now, you’re scared like, “Oh, [crosstalk].”
Tobias: [crosstalk] to see the print.
Jake: Yeah, I hope they don’t poop the bed in this quarter, because I can’t take another 50% drawdown.
Ian: That’s the human nature of it. You overanalyze when things are dropping and you under analyze when things are going up. Instead of becoming a macro strategist during drawdowns, you should just be nibbling the things you like as they go lower, instead of just trying to pick a bottom, which can cost you more money.
Tobias: You don’t want to spend time on social media through times like this. One of the things I don’t check my portfolio prices during the trading day. That’s one of my rules. I wait until everything closes, because it feels more static and slower. Things aren’t moving all over the place. I find it easier to think when nothing’s trading. But I can get like a contact high just by going onto social media and seeing everybody panicky one way or the other. I’ve certainly got it today, just from being on I can see everybody going absolutely bananas in my stream and yesterday, too everybody was going nuts. You don’t need to know what the actual print is to know roughly what’s happening– [crosstalk]
Jake: You can just [crosstalk] the room. [laughs]
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