Strategies for Compulsive Portfolio Checkers

[portart]

What are some ways for stopping the checking of your portolio every day or multiple times a day? It is a time waster, it eats up energy, it can lose you money, and can cause compulsive buying and selling.  It's habit but it is hard to break. Also, reading Marketwatch and other stock websites can also throw you off the apple cart, no matter how interesting reading articles are.

For example gold has been dropping everyday. You might want to change your gold allocation but it can make up for a years losses in a matter of hours and you could be out of it the day that it happens.

The stock market is rising up incessantly. You know a drop is coming so you sell out only to watch it rise two more years unabatedly before it corrects.

You read that rates are going up so you want to get out of long term treasuries but the Fed decides to keep rates down for the next two years based on bad employement numbers. ...Yikes!! You are losing your mind going back and forth.

You decide the hell with it and stay with PP and not look but once a year to rebalance.. nice idea. Since a lobotomy isn't such as great idea, what other ways can you break this impulsive habit of checking???

[Pointedstick]

Cut the news (financial and otherwise) out of your life. It is a cancer of this world that breeds fear and apprehension.

I had to go through a period where I didn't read any news for about a year. It was a pleasant shock to my system. Now I feel like I'm more responsible with the news, and I do occasionally read it but it doesn't generate the fear it used to. Its power is broken.

[Tyler]

There are really two issues here -- the compulsion to track your investments, and the temptation to change them.

For the tracking issue, if you look many times a day try setting a schedule.  Maybe even set an alarm for when markets close and make that your update time, which would also help the temptation to change since you'll always have to sleep on it.  Another idea is to delete the stock app from your smartphone.  Force yourself to take more steps to look the info up.  Eventually you'll realize the compulsion is just a form of information addiction.

For the temptation to change investments, stop reading financial news.  It's largely useless.  When you look at stock charts, set them to a multi-year view and not a daily one.  What feels like a big move now probably isn't much in the grand scheme of things.  And write out why you invest in the Permanent Portfolio (or any other investment you're in).  Put that somewhere where you can easily re-read it later.  If you later decide your original logic was wrong, write out why you plan to do the new thing before you do it and wait before you take any action.  Keeping an investing journal may not only help you stay the course now, but also point out to you later when and how your fear gets the best of you in your decision making.

If you're just stir crazy, it also helps to displace that energy to something else.  I prefer to think about ways to reduce my annual spending than how to continually maximize my investment returns.  Both get you to the same place of more cash flow, but the first is far more in your control. 

[sophie]

Cut the news (financial and otherwise) out of your life. It is a cancer of this world that breeds fear and apprehension.

I had to go through a period where I didn't read any news for about a year. It was a pleasant shock to my system. Now I feel like I'm more responsible with the news, and I do occasionally read it but it doesn't generate the fear it used to. Its power is broken.

This is a great recommendation.  Of course the news now is quite interesting, though it's sometimes difficult to wade through what is actually news vs. what is simply advertising, crowd-heckling, fear-mongering, or outright minimally informed opinion.'

Also here's another suggestion to cut down on portfolio checking:  spend your internet surfing time reading a topic that interests you but that doesn't include market reports or "news" - like this forum!

[portart]

Question...Am I the only one here with this insidious compulsion?

[buddtholomew]

Question...Am I the only one here with this insidious compulsion?

Uh...no! I may as well have written your original post. I am not the "resident worrier" for nothing. I've earned that badge.

[barrett]

I look way too often. A big reason for me is that I find this forum interesting and it's hard not to check on current values when people are talking about LTTs, stocks and gold.

I am planning to start getting quarterly paper statements but I don't know if that will help because it takes 30 seconds to log in and get daily or monthly info.

I have gone through times in my life where I barely checked anything and I have to say it's the desired state for me. Also, at least for me, I don't check out of worry, it's just compulsive behavior.

[Tyler]

Years ago, I would check every few months.  Lately I check pretty compulsively because I've been saving up to a big goal.  Now I hope to cut back to my older habits. 

[DragonJoey3]

Something I find helpful is channeling that energy that I would normally use on checking my portfolio into something like freelancing, or starting a side business.  Most people will get a greater return out of increasing their income and finding ways to cut expenses than they will playing with their portfolios.

[buddtholomew]

http://www.bogleheads.org/forum/viewtop ... 0&t=147418

"Several days ago, I sold GLD to reduce my allocation to gold and purchased All World ex-US with the proceeds. I was convinced that the decision was rational, but it was market timing plain and simple.

Today, I reversed the trades and restored my precious metals allocation to the original percentage.

We really are our own worst enemies."

I was too embarrassed to mention it on this board, but I am back to the HBPP 4x25 allocation as of 9/23. I almost snatched defeat from the jaws of victory as the adage goes. I blame myself for checking too often, seeing the obvious trends (e.g. strengthening USD) and reacting to them and being obsessive about the value of the portfolio. So, I do understand your compulsion as the above real world example illustrates.

[I Shrugged]

I am trying to recall how I got to my present state of ignorant bliss.

I accepted and believe that predictions are useless.  As are investing "stories", such as China is a bubble, we are running out of oil, or whatever.  Once I came to that realization, it was pretty pointless to read or watch most of the financial press.  Sometimes I do like to hear the current thinking, but usually I end up saying to myself that they are just paid entertainers for the most part. 

So I guess, if you continue to partake in financial porn and check your portfolio with a worry towards changing it, it probably means you don't buy what Harry Browne, Bill Bernstein, John Bogle, and many others have proved about passive investing.  You continue to think you are going to outrun or outsmart the market.

I do admit to following the political-economic type news and debates.  Which often include advice that if you don't do X with your investments, you are doomed.  But I'm surprisingly unmoved, even by those with whom I strongly agree.  I have watched them and all of it long enough to be able to see that none of them can predict the market.

Hope this helps.

[Alanw]

http://www.bogleheads.org/forum/viewtop ... 0&t=147418

"Several days ago, I sold GLD to reduce my allocation to gold and purchased All World ex-US with the proceeds. I was convinced that the decision was rational, but it was market timing plain and simple.

Today, I reversed the trades and restored my precious metals allocation to the original percentage.

We really are our own worst enemies."

I was too embarrassed to mention it on this board, but I am back to the HBPP 4x25 allocation as of 9/23. I almost snatched defeat from the jaws of victory as the adage goes. I blame myself for checking too often, seeing the obvious trends (e.g. strengthening USD) and reacting to them and being obsessive about the value of the portfolio. So, I do understand your compulsion as the above real world example illustrates.

Budd,
You had previously posted that you had split portfolios: HBPP/Boglehead. Have you now gone totally to HBPP or do you still have the split portfolios?

[buddtholomew]

http://www.bogleheads.org/forum/viewtop ... 0&t=147418

"Several days ago, I sold GLD to reduce my allocation to gold and purchased All World ex-US with the proceeds. I was convinced that the decision was rational, but it was market timing plain and simple.

Today, I reversed the trades and restored my precious metals allocation to the original percentage.

We really are our own worst enemies."

I was too embarrassed to mention it on this board, but I am back to the HBPP 4x25 allocation as of 9/23. I almost snatched defeat from the jaws of victory as the adage goes. I blame myself for checking too often, seeing the obvious trends (e.g. strengthening USD) and reacting to them and being obsessive about the value of the portfolio. So, I do understand your compulsion as the above real world example illustrates.

Budd,
You had previously posted that you had split portfolios: HBPP/Boglehead. Have you now gone totally to HBPP or do you still have the split portfolios?

I still have the split portfolios.

[Bean]

I have an account that I actively manage.  It seems to keep my attention and urge to tinker away from accounts dedicated to investment strategies that require no tinkering 

[portart]

Haven't looked at my acct, the price of gold or read Marketwatch since Thursday. It's like being lost in your own neighborhood. Not sure how long I will last. Kind of miss the end of the world articles but no panic sells either.

[I Shrugged]

Haven't looked at my acct, the price of gold or read Marketwatch since Thursday. It's like being lost in your own neighborhood. Not sure how long I will last. Kind of miss the end of the world articles but no panic sells either.

Like a lot of addictions, it's fun to do those things.  But you have to try to see the flaws and dangers. And when you do watch, pay attention to the impulses you start having.  Such as "omigod, stocks really are about to crash!"  Doing so helps to remind yourself of the problem you are creating.  When I do turn on CNBC, which is extremely rare, I get this bad feeling that "I don't want to go down this road".  It's not harmless.  It might not be very harmful either, if you can handle it.  But if you could handle it, you would not be asking for help. 

[portart]

What it is a duel thing. One is a feeling that your about to lose money you made and you want to prevent going down.  The other thing is the feeling that you think your going to feel better selling. However, neither of things things work because once you sell out, now your REALLY watching every day with worse problem, when to get back in.

Before you were watching passively (if you don't sell or trade) accepting what the markets are doing. Now you are out, sitting in cash, moving a point of inactivity (outside of just watching) to thinking about when to start getting back in.

For me, I decided that the best gains will be when gold moves but you can't put 25% in gold and be all cash on the rest because if the gold market moves against you, you don't have a counter balancing position to even it out. The only smart way to play it is to keep your 25% in gold (or IAU) and have the rest of PP in force. Now you are not greedy, willing to accept counter balance losses, but still keeping a strong position in gold.

This is what PP is all about anyway and why it appealed to me. It's the mental part that sticks its head in there to upsets the apple cart. I still haven't checked anything. I am not happier but I do have more mental energy to do other things besides checking Kitco and Marketwatch.com five times or more a day. No question it's an addiction, being a checker that is.. a compulsion.

[dualstow]

I look all the time and feel no need to stop.
But, I don't worry about the portfolio.

[portart]

Then why do you check it everyday?

[Thomas Hoog]

Nice issue: Use your VP portfolio to satisfy your human behavior ?
I use a dividend stock portfolio to mess around, YTD 16,3 %, takes my mind off the core PP portfolio.

[dualstow]

I look all the time and feel no need to stop.
But, I don't worry about the portfolio.

Then why do you check it everyday?

Because I love to do it. I just did it and I'm ready to do it again.



Seriously, that's why. That, and because I need to rebalance gold and I want to watch it hit the rebalancing band.

[Gosso]

Try Fantasy Hockey or Football.  I now waste most of time looking up hockey stats than stock stats.

[TripleB]

I've been checking my portfolio every day. I'm inching towards early retirement and I like seeing the total amount get bigger.

Of course, as HB said, my portfolio is getting bigger because of my job and contributing new money. My portfolio goes up around 4% per month lately, from new contributions.

I'm more checking it to see how my new contributions are making a difference. It's helping me spend less and save more because I'm watching the numbers regularly. The actual investment movements don't phase me much. It kind of sucks to watch them go down recently but it's no big deal.

I have zero temptation to change my allocations or do anything different from 100% PP. And when things happen like everything but cash goes down, I think "great! It means my 4% contribution this month will buy much more of each of the assets."

When I'm not working I don't check the PP often at all because it doesn't matter.

[sophie]

TripleB and dualstow - same here!

I don't check it every day, but I update my tracking spreadsheet every month and at the end there's a summary chart tracking income, spending, and theoretical income from savings/stash (i.e. the YMOYL "wall chart").  It's the chart I'm focused on, not individual investments, apart from checking the PP asset balances.  It's incredibly satisfying to watch progress.  It also did wonders for peace of mind to realize that suddenly losing my job would not be catastrophic.  I'm in no danger at the moment, but others with similar positions have not been so fortunate.

Also it is very useful to log into all my financial accounts monthly which I might otherwise forget to do.  It's important for detecting any fraudulent activity (god forbid) or the occasional snarky attempt at changing fee rules in the hopes that account holders won't notice (HSA Bank did that recently).  Credit Karma is helpful for fraud checking, btw.

[Mark Leavy]

I check mine every day - but only because it is part of my morning process.  I have a master spreadsheet that I update with my morning coffee.  It takes me about 10 minutes to update all of my numbers and I get a brief overview of how my life is tracking.

Like the other dimensions of my life, I don't worry too much about the daily swings in the PP.  I do mentally check it, however, to ensure that it is essentially tracking the theory.  The same with all of my other numbers.

10 to 15 minutes every morning to update the numbers.  Stare into space for a few minutes and absorb the trend lines.  If all is proceeding as I have foreseen... on with my day.



I think the real key is to realize that the PP is a system - not a goal.  Once you have accepted that it is a reasonably good system that will move you ever closer to your goal of (whatever the hell your goal is...) then you just need to monitor it every now and then to ensure that the basic mechanisms aren't broken.

Realistically, it should just be ONE of the systems in your life.  Hopefully you also have a system for health and relationships and career growth and language and music and ...

Once you've settled on a system that is pretty adequate.  Move on to the next dimension of your life.