The 80/20 Reality of Investing: Why Patience is Your Greatest Asset 2025-02-12

Ever heard a fund manager admit that 80% of the time, their portfolio is losing money? It's a sobering statistic, but it highlights a fundamental truth about the market: timing it perfectly is incredibly difficult, especially with cyclical stocks. Mr. Market is a fickle beast, and getting his valuation right is a constant challenge.

My own investment journey has mirrored this reality. My first six years were a dream, yielding healthy returns. But the next six? A nightmare. I saw losses mount, totaling around S$35k. It was a painful period, a true test of my resolve. But here's the kicker: the very next year, I recovered all those losses. Every single penny.

This experience taught me a powerful lesson: investing requires patience. And not just a little bit of patience, but the kind of deep, unwavering patience that allows you to weather the inevitable storms. It also underscores the importance of continuous learning. The market is constantly evolving, and if you're not learning and adapting, you'll be left behind. It reinforced the idea that successful investing isn't about timing the market, it's about time in the market.

And speaking of the long term, here's another crucial point: You can be absolutely right about your investment thesis, but the market can remain irrational for far longer than you can remain solvent. I never anticipated the Hang Seng index performing so poorly for such an extended period. It was a humbling experience. This underscores the need for a financial buffer, a cushion to help you weather these unexpected downturns. In the investment world, survival is key. You need to outlive the market's whims, to be in the game long enough to see your predictions, your well-researched convictions, finally come to fruition. Sometimes, the greatest return is simply being able to stay in the game.

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