Taming Bulls, Bears, and Ourselves
EQ Matters More Than IQ In Stock Market
Just a few months ago, in August and September (2024), everyone was talking about how the market was on fire.
The bull run had everyone excited. And now, as we went through December and step into January (2025), things have flipped.
Note: Views expressed here are personal
People are worried. Markets have fallen, and portfolios don’t look as shiny anymore.
It’s fascinating, isn’t it? The same people who were optimistic just a while back are now fearful.
This rollercoaster of emotions — greed when the markets rise and fear when they fall — is something we’ve all experienced.
But here’s a thought: is there a better way to deal with this? Can we find a way to step off this emotional ride and focus on what really matters?
The Emotional Cycle of the Market
Let’s talk about bulls and bears for a moment.
The market has both, but the truth is, these bulls and bears live inside us too.
The bull represents our greed — when the market is going up, we want more, fearing we might miss out.
The bear represents our fear — when the market starts falling, we want to sell everything, worried it might crash further.
Think about it. How many of us felt tempted to buy more during the bull run because we didn’t want to miss out?
And now, with markets falling, how many of us feel like we should sell to avoid further losses?
These emotions — greed and fear — are powerful. But acting on them often leads us to make the worst decisions.
We buy when prices are high because of FOMO, and we sell when prices are low because of panic. It’s like running in circles but getting nowhere.
Focus on What Matters
So, how do we break free from this emotional cycle? By focusing on what truly matters.
First, let’s address the fear of short-term volatility. Markets go up, and markets come down — it’s normal.
Volatility is like waves on the ocean. If you’re in a strong ship, you don’t worry about every wave, right?
In investing, that strong ship is the quality of the businesses you’ve chosen.
What does a strong business mean?
It’s a company with solid fundamentals, steady growth, and the ability to withstand tough times. These are the businesses that can survive storms and keep growing over the long term.
But it’s not just about picking strong businesses. It’s also about buying them at the right price.
Think of it like getting a high-quality product at a discount. If you’ve done your homework and know what the business is worth, why let temporary drops scare you?
And this is where patience comes in. If you’ve bought a robust business below its fair price, time becomes your friend.
It gives the business a chance to grow, and eventually, the market will recognize its true value. You don’t have to worry about every short-term dip if you’re confident in what you’ve bought.
So, here’s the takeaway.
The next time you feel the excitement of a bull run or the fear of a market drop, remind yourself: the real challenge isn’t about taming the market.
It’s about taming ourselves — our emotions and our behavior.
Stay focused on finding robust businesses. Understand what they’re truly worth. Ignore the noise of short-term market movements.
When you do this, you’ll find that you’re no longer running on the emotional rollercoaster. Instead, you’re calmly building your future.
Remember this: the bulls and bears will keep running. But it’s up to us to stay calm and run our own race.
Note: Views expressed here are personal
If you loved this story, please feel free to check my other articles on this topic here: https://ankit-rathi.github.io/tradevesting/
Ankit Rathi is a data techie and weekend quantvestor. His interest lies primarily in building end-to-end data applications/products and making money in stock market using Quantvesting methodology.
