3 Investing Lessons I Learnt From The Recent Haze

Just yesterday, I met some friends for lunch at Dhoby Ghaut. After they returned to their office for work, I realised I had both some time and some calories to burn. I had a movie date with the Mrs at night (I hope you are not surprised that we do that occasionally) and there was still another 4 hours to go.

So, I brainstormed. And came up with the best solution I always have in the back of my mind:

Taking a leisurely 20 minutes stroll to Kinokuniya @Ngee Ann City

Unfortunately, I changed my mind when I stepped out of the mall. I had almost forgotten who was back.

I'll be back Terminator - Who's Back? Arrgh...It's haze

But before I started complaining and lamenting the unfairness of it all (like what most Singaporeans do when things don’t go their way), I turned my stoical mode on for a few minutes. Besides getting some peace of mind, I also learnt 3 lessons I could apply to my investments! How’s that for killing two birds with one stone, eh?

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Stop Worrying Over What You Can’t Control

Thankfully, no opposition parties blamed the government for the haze. Seriously, that would have been a new low in our politics.

Ok, I digress. But if the Singapore government offers help to our Indonesian counterparts to help fight fire, and get rejected, there’s nothing much you can do as a normal citizen in Singapore. No matter how rich or influential you are.

game of thrones animated GIF

Nothing I could do about Joffrey either in the first 3 seasons of Games Of Thrones

There are just some things that are out of my control. I have to accept it. And this actually extends to my investments.

As a retail investor, there’s little I can do to prop up the share price of a stock. There’s also nothing I can do to stop oil prices from dropping or the Fed to keep or raise interest rates. 

There’s no point worrying whether the fires would be put out or if the market tanks/soar. These are simply events out of my control.

Haze & Market Corrections Are Temporary

This is not Singaporeans’ first encounter with haze. We had one bad case in the late 90s and one severe case just two years ago when the PSI soared past 400.

We know that haze is temporary. If the wind blows in the “right” direction or there’s a heavy downpour, the poor conditions would be somewhat alleviated. And with time, the forest fires in Indonesia would definitely be put out.

Few people migrate just because of the haze, right?

Similarly, we have always had market corrections or even bear markets. And with enough time, the market would always move back up. And this trend is likely to continue, as long as capitalism remains and businesses continue to make profits from the products and services they sell.

Going by the same logic, few people should sell out just because of a correction, right? 

Take Actions On What You Can Do To Mitigate Present & Future Circumstances

Of course, there are some actions we can take to improve things.

If I have respiratory problems or have young children, I would have invested in some air purifiers and N95 marks long ago and kept them in the storeroom. And not wait till PSI reaches 500 and then join the super long queues in vain.

As for now, I would just try to stay indoors. Drink more water and stay hydrated etc. And for someone with access to a gym just a 5 mins jog away, a haze is simply no excuse for not exercising.

arnold schwarzenegger - There's no excuse.

Arnie wants me to go to the gym after I finish this post.

If I know I can’t stomach a 50%, 40% or even 30% paper loss in the stock market, this investing game might not be for me. However, if I am going to feel better if I know my overall portfolio declined less than others, I would simply just need to have more cash and bonds in my portfolio.

It’s about finding a rational and consistent strategy that I can stick with that prevents me from “buying high and selling low”. It should also help me to stay invested and and ride out the market cycle.

With an overall strategy in place, I would be more prepared to wrestle a bear market in the future. This is something that is fully within my control and I would be foolish to ignore it.

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In case you’re wondering, I took a shorter walk to the Orchard Library yesterday where there was a huge collection of new fiction books. I had a great time there and the sages are right. Silver linings abound…

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    7 thoughts on “3 Investing Lessons I Learnt From The Recent Haze

      1. My 15 HWW Post author

        Hi Kevin,

        Yes, surprises are important too! From what you mentioned, my wife would probably envy your Mrs. :p

    1. Singaporemm

      Great comparison! I didn’t know the haze could teach us so much.

      I must also point out that despite my free and easy schedule I consciously only watch weekday movies because I refuse to pay a premium for weekends. 😛 So kudos to you, fellow weekday movie watcher!

      Regarding the haze, I don’t think it is a main consideration for people who want to migrate, but it is a strong secondary contender. The weather here is overall just not very nice, what with the extreme heat and humidity, and the haze just makes it worse. It seems to be stretching out this year. I remember 2 years ago (with the 400 PSI – I was actually out and about at that time!!! Insanity, worse than Silent Hill) there was just maybe 2 weeks that were really bad, but this year it seems like the haze is coming on and off for months. (like sideways stockmarket movement maybe?)

      1. My 15 HWW Post author

        Hi Singaporemm,

        Think for people like us, it doesn’t really make sense to pay a premium to watch movies. On Mondays/Tuesdays, it’s also so much more enjoyable with less crowd.

        Actually, I have had some friends who have emigrated due to the weather condition. Especially if they have a child with a bad case of asthma. I personally don’t take very well to hazy conditions. My sinus flares up and my eyes are easily irritated. Oh well…