Sunday, August 23, 2020

On Human Nature

One piece of advice that my veteran trader friend SMOL gave me when I started out investing is to keep a diary of the emotions that I am feeling at the point of a trade. Since then, I have paused before every buy/sell trade, collected myself and recognize the emotions at play, before hitting the trigger. Over the past couple of months, I realized that my emotions were less calm than before. Not because of the volatility in crypto prices, but because of the reactions and meta-reactions of others.

1). You receive a lot of hate

Through non-public channels, I have received my fair share of hate from traditional finance (tradfi) bloggers. I was very disappointed, to say the least. I have shared what I have learned with openness and some of the questions and responses were hostile and combative. This taught me the importance of differentiating genuine enquiries from keen learners against the toxic vitriols of trolls who are out baying for blood.

Without realizing it, I bore a grudge against these bloggers and wanted to prove them wrong. With time, I realized this was pointless and that it is more important to ignore and move on. 

2). I keenly understand the arrogance of successful crypto investors

The crypto bull market has just started. Over the past 1 year, crypto investors who adopted a fundamentals-based approach ended up as the laughing stock in the investment community. This year, these crypto investors returned with a vengeance. As such, I can empathize with their need to flex their winnings. Not that this is the right thing to do, but one way or another, the pent-up frustration needs to be released. This is entirely human and normal.

3). Trolls respond by concern trolling

"What if your success is temporary?" and "Careful now, success comes before a fall" are some rather pointless statements that I have seen being made. The truth is that a discerning student of the market knows this; every asset class has its day.

4). Some trolls turned "friends"

Some of the more adaptable trolls learned that they were wrong, pretended that the past did not exist, and that they have your back all along. Beneath the facade, it is still possible to glean their bitterness and envy bubbling under the surface. Now, they want you to hold their hand and help them profit, without regard for how things work. When sentiments turn negative again, do not expect that your back remains free of stab wounds.

5). The value of time

While the above is happening, Ethereum is undergoing a Cambrian explosion. The decentralized finance (DeFi) sector has been pushing the boundaries of innovation on a daily basis. On one particularly crazy week, a few crypto personalities on Twitter mentioned that they are experiencing sleep deprivation as there is money to be made. Some of these individuals rely on speed for alpha; they need to exploit opportunities earlier than others do. While I do not practise this form of investing, the speed of the developments still mean that I have to constantly keep myself updated on developments within the space. Crypto has heightened my perception of the importance of time. Wasting time on trolls is the last thing I want to do.

6). Be careful who you pay attention to

This is particularly important for people who are new to the space. Following the "advice" of some influencers could lead to financial ruin. What has worked for me is to develop my investing competency first and then carefully curating the works of reasoned, sound, and savvy investors from the crypto space for further analysis. For those with minimal personal finance or investing background, tread carefully. Off the top of my head, I have heard of "savings accounts are a ponzi scheme" and "equity is whatever you want it to be" from high-profile influencers. Either they are ignorant of finance/investments (unlikely) or they are deliberately redefining terms and misleading people.

7). The dilemma of assisting newbies

With increasing prices come new blood. New blood differ in their abilities. Some require a lot of hand-holding and spoon-feeding while others are independent learners. When things are swell and everyone is raking in profits, no one cares. When fortunes turn, there will be finger-pointing and accusatory statements. Some influencers have started to brush off questions. Why burden yourself with the financial health of others? This is a thankless job.

8). Completely missing the point

What is the purpose of investing? To earn a return. That's it! Plain and simple. Instead of preparing for the next trade, I observed people who kept over-analyzing, writing dainty essays, have long-standing discussions with other investors and did.........precisely nothing. So-and-so stock/crypto has 5 pros and 4 cons, oh noes! What do we do? Another stock/crypto has 4 pros and 1 cons and have shot up in price. Will it come down because of that 1 drawback?!?!?

Su Zhu, CEO of Three Arrows Capital, said it best with the following:

su zhu

9). You do not have to participate in every single trade

I know. I know. There is plenty of money-making opportunities in Ethereum and new ways to make money is popping out left, right, and centre. This bears repeating again. If you do not know what you are doing, it is alright to miss out on some of these returns or take smaller returns with lesser risk. 

10). The importance of humility and opsec

Yes, yes, I know. Crypto and US Tech investors are rolling in money right now. But please be sensitive. COVID-19 has displaced many from their jobs and inequality is on the rise. There is no need to aggravate others and unnecessarily place a large target board on one's back. The following is a good reminder from Fiskantes.


Alright. Enough time has been spent writing this post. Ignore the naysayers and invest safely people!


  1. Seriously, that many haters in blogosphere huh? Sorry you have these unpleasant experiences.

    1. Yeah. The benefit is when they reveal themselves, I now know who to avoid.

    2. You are only sharing your investing journey and points of view on different aspects of investing. Why should anyone have a problem with that? Alamak, different people, different views; different people, different strokes ... anyway avoid toxicity as much as you possibly can. Now go read yr sci-fi. :-)

    3. Yeah. Liu Cixin released some more books recently. Haven't started reading yet!

  2. Where does the winning money come from?

    Winners turn on the emotion of losers into haters?

    1. Hi Uncle CW,

      From new money buying up the asset.

      Not quite. Remember the time when a blogger cursed his investment rival and his family to get cancer because his trade turned out differently from his rival? Salty people are getting more unhinged.

  3. Hi UnN

    I do not understand the crypto space but it is inside the inefficient markets that are most misunderstood and also the greatest potential profits to be made. Contrarian investing has the best payoff when no one is looking at it.

    Just manage your risk well and focus on what you are doing! Look forward to your next post.

    1. Thanks INTJ. Will update once the activity in Ethereum dies down. Cheers!

  4. better dun listen to SMOL snake oil advice hahahahaha.
    People advice keep diary to track expenses and investments, he asked u to track emotions!


  5. Hi UN, you will never get any hate from me. I also interested in crypto but I humji. lol. read here and there but no action then price shoot liao.

    1. Hi KPO,

      Thanks man. Appreciate it!

      Can start with Brave Browser. They give you a bit of free money each month.

  6. Really enjoyed reading your latest article! Booking marking the blog :)

    I look forward to an upcoming post on Aavegotchi haha