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Perspectives

Wednesday, September 9, 2020
  • Writer's pictureK

Two people, A & B meet at a coffeeshop to catch up and talk about the recent state of things. A says, "Times are bad, this pandemic has really disrupted all my business and meetings. And I've lost so much money in one of my ventures". B nods in agreement and says, "Yes. It's really bad. I invested in this company awhile back and lost something like $5,000. It's really a struggle now". A replies, "That's not a struggle man, $5,000 is nothing. My losses are in the hundreds of thousands."

  • Everyone's perception and threshold of money and risk are different. A thousand dollars are very different to the average person and a millionaire.

  • Knowing that someone else lost more money than you does not make you feel better; Conversely, telling someone else that you'd lost more money doesn't make you feel better as well.

  • Risk and reward is always equitable and pro-rata to capital contribution i.e. you cannot expect to get more than what you put in. Be rational and at peace with what you have invested and taken.

  • A fool and his money are soon parted.


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