Investor Jim Grant once said, “To suppose that the value of a common stock is determined purely by a corporation’s earnings discounted by the relevant interest rates and adjusted for the marginal tax rate is to forget that people have burned witches, gone to war on a whim, risen to the defense of Joseph Stalin and believed Orson Welles when he told them over the radio that the Martians had landed.”

Investing in the stock market is often viewed as a purely analytical practice that should look something like this…

One of the most frustrating parts of investing is that you can be right and wrong at the same time. Recent Netflix stockholders know this all too well. The story about Netflix back in 2018 was that their subscriber base was breaking out and that tremendous growth was ahead.

And they were right. Check out these numbers over the past 5 years….

Over the years I’ve noticed something about the clients I work with that behave well during market volatility – they don’t check their accounts all that often.  

They could probably tell you approximately how much they have invested, but it wouldn’t be exact – maybe off by 5 to 10%. When asked how they felt during a difficult year like 2022, they answered “fine – I just didn’t look.”  

To some, it may seem careless. But is it? Consider an investor who checks their accounts daily. Historically, they have about a 50/50 chance of seeing red on any given day – 46% to be exact…