From the outside, everything looks easy

Investing seems simple. You buy a stock that goes up, and if it doesn’t go up, you simply don’t buy it. Right?

My daughter’s primary school teacher is a smart man with wide interests. What fascinates me is how he reflects on his life before and after having children. Back then, he wondered why parents struggled so much with raising their kids. In school, he gave instructions and the children usually did what was expected. Meanwhile, he watched mothers and fathers being kicked by their adorable little ones. Today, he has a kindergarten child of his own. His view of the world has shifted. “Your child” is very different from “my child”.

Parenthood changes us. From the outside, things often look straightforward. We tend to underestimate our own role. And the same is true in investing. What happens inside me when my portfolio suddenly shrinks because markets fall?

The gap between emotion and action

We are notoriously bad at predicting our emotional reactions. We think we are cooler than we really are when the moment arrives. And fear is not always about a looming crisis when prices drop. Sometimes it is the fear of missing out. FOMO can be powerful. Uncertainty becomes dangerous because we start chasing rising prices and stretched valuations, hoping they will keep climbing. Possible, yes. But only a tiny fraction of investors manage to exit at the perfect moment.

With time, we realize that we need a pause between emotion and action. In the short term, fear and greed can take the wheel and steer us into poor decisions. That is when it helps to have a professional partner at your side. Someone who stays rational and sticks to the agreed discipline. And I do not need to tell you who excels at that.