It’s been a while.
Unprecedented times call for every iota of resilience that’s inherent.
Whatever we’ve learnt in the markets is being tested to beyond all levels.
If our learning is solid, we will emerge victorious.
If there are vital chinks in our armour, we will be broken.
Such are the market forces that are prevailing.
Have we learn’t to sit?
Meaning, over all these years, when over-valuation ruled the roost, did we sit?
Did we accumulate funds?
Did we create a sizeable liquid corpus?
If we did, we are kings in this scenario.
One of the main characteristics of a small entry quantum strategy is that it renders us liquidity, almost through and through.
If we are amply liquid in the times of mayhem, there is absent from our armour the debilitating chink of illiquidity.
Illiquidity at the wrong time makes one make drastic mistakes by succumbing to panic.
We’re not succumbing to any panic.
Because our minds are focused on the bargains available.
The bargains are so mouth-watering, that they are entirely taking away our focus from existing panic.
To twist our psychology into the correct trajectory in a time like Corona, the secret ingredient that’s required is called (ample) liquidity. This secret ingredient is a direct result of the small entry quantum strategy, which we follow.
Then, let’s address the other potential chink, and just sheer do away with it.
Having access to ample liquidity, are we now greedy?
What does greed mean?
It’s not greedy to buy when there’s blood on the street, no, it’s actually outright courageous.
Greed Is defined here as per the quantum of buying.
Are we buying disproportionately vis-à-vis our liquidity-size and our risk-profile?
How will we know the answer without any doubt in our mind that we have the correct answer to this question, since it is vital to our learning curve to answer this question correctly?
The answer will make itself felt.
Are we able to sit optimally even if markets crash another double-digit percentage from here?
50% from here?
No? Greedy. We have bought in a manner that doesn’t gel with our risk-profile. Our liquidity is exhausting, and focus shifts from bargains to panic. Ensuing tension amidst further fall will very probably cause us to commit a grave blunder, with this happening very probably at the bottom of the market. We are poised to lose in the markets like this.
Yes? Not greedy. We have bought and continue to buy as per our risk-profile. We will win…
…in the markets.
The secret ingredient that locks in great prices and continues to do so as the market keeps falling, is called quantum-control as per the tolerance level of our risk-profile towards further fall. This secret ingredient ensures that liquidity outlasts a longish fall, keeping our focus on the bargains and not on the panic. This secret ingredient provides for the basic mechanism of our small entry quantum strategy.