RiskSmith Update: October 25, 2022
Dan Muse
October 25th, 2022
Blog | RiskSmith Update: October 25, 2022
Hi there,
Another strong Monday yesterday (S&P 500 ⬆️ 1.2% | DJIA ⬆️ 1.3% | Nasdaq ⬆️ 0.9%) — but as usual, we’re taking a broader view (it’s kind of our brand¹). Specifically:
We need to rethink the “diamond hands” mentality
Most of you probably know this term already, but just in case:
Diamond hands 💎 👐 /dī(ə)mənd hands/ noun, colloquial
Investors with extremely high tolerance for volatility are said to have “diamond hands” — the idea being that they won’t sell until an asset becomes extremely valuable. The term emerged from the r/WallStreetBets Reddit community.
Our co-founder, Dr. Richard Smith, said recently that it’s time for most investors to rethink this philosophy. Watch the video:
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Diamond hands means you’re willing to hold to zero. You’re in this for some other reason besides just making a fortune. Diamond hands means you believe in the future — of Bitcoin, or Ethereum, or whatever your diamond hands are.
You know, if you’re just diamond hands because of some kind of speculation game — man, you’re the patsy at the table. You’re being played. And that’s where most people are. It’s just a narrative to explain the fact that we don’t want to sell, we don’t want to take a loss. You’ve got loss aversion and you don’t want to sell when you have losses.
— DR. RICHARD SMITH
There aren’t a lot of hard-and-fast rules when it comes to investing, but “believe in what you buy” is a good one. When you truly believe in something, and you’re willing to take the good with the bad — that’s when diamond hands might be for you.
Join the RiskSmith Advisory Panel
Most of the amazing new additions to the app (current and future) came out of user feedback.So we’re about to ramp that up. Over the next year or so, we’re doing more:
customer interviews
surveys
usability testing of new RiskSmith features and functionality
If you’re reading this, you’re an early adopter, and we can’t thank you enough.Ready to take the next step and help us shape the future of RiskSmith? Click here to get started!
The markets are getting gritty
Examples of the law “correlation ≠ causation” are probably the most fun you can have in the logic game. For example:
Screenshot from r/baseball on Reddit.
Enjoy that one — but probably don’t bet the nest egg on it.
Have a great week, everyone!
¹On that note — on Thursday and Friday of this week, we’ll be making a few changes to the website. You shouldn’t see any downtime. But if you see something different (in the address bar, say), don’t fret. 😉
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