Friday, 13 May 2022

100X versus 99%


Percentages can lie, don't they?

Its a lot easier to manipulate others and own self lie to own self - when we count in percentages.

For those not into cryptos, you can google "Luna crash" to discover for yourself why cryptos in general have crashed more than equities this week.

No, this post is not about cryptos. Just using them as an example.

Have you ever heard the "spin" that its better to long stocks than short stocks?

I mean if we long stocks, there's no cap or limit on how many times our position can double - 2X, 10X, 50X, 100X!!!

But if we initiate a short on stocks, the theoretical max we can make is 100%.


(For newbies unfamiliar with shorting out there, we cannot short and hold forever OK? If a stock get suspended or unlisted, how do we collect our winnings?

An added bonus when you do shorting is you'll learn and appreciate the discipline to take profit as in covering your short position before a stock gets suspended!

Its like driving with a metal spike on the steering wheel instead of airbags!

This "market timing" discipline would definitely benefit your long positions too.)


Let's take any asset, be it cryptos, stocks, bonds, etc.

If we buy at $1, and that position moonshot to $100, how much have you make in real dollars if we take profit?

On the flip side, if we short at $100, and the position cratered to $1, how much have made again in real dollars when we cover our short?

100X versus 99% gains. Which is easier to spin to unsuspecting "bei kambings"?  (Hope someone can spot the mind manipulation I'm doing right now)

Its the same with stocks indexes.

Would you be better off  if your chosen "passive" index has only declined by -9% recently from all time highs, while you gloat at others who have invested at another index that have declined by -28% from its all time highs?

What if you had bought the STI in 2018 at 3500 while others bought Nasdaq in 2018 at 8000?


Of course I can also make STI look good, better, best than Nasdaq just by datamining to find a start date that suits my "thesis"!


Moral of story?

Trust but Verify.

And never believe any statistics that you've not personally manipulated yourself!



  1. Smol,

    Ahhh but the 100X trade needs just $1 capital, while the 99% one needs $100 lol.

    Unless got Interactive Brokers account & the share can be fractionalized keke.

    At the end of the day we need to understand the nature of assets & know what is speculation & what is investment.

    There are some assets/vehicles where you can long & forget.

    But depending on the asset's possible range of volatility, and one's time horizon & liquidity, can still get wiped out.

    Same if one is using leverage or derivatives. Can be wiped out before the thesis ultimately goes in your favour for thousands of % profits. ;)

    1. Spur,

      Well, I did put in brackets hoping someone will call me out ;)

      That's the reason why there's a difference between climbing up the mountain and climbing down the mountain.

      Youths with tiny accounts, you can take a bit more risks...

      Lose is max $1; win can moonshot to $100 for the lifestyle changing win!

      A very "affordable" $10K speculative bet on Luna, when its around $1, can help you become an "instant" millionaire when you SOLD at any price when the price was above $100.

      For old fogey multi-millionaires, when they put 1 or 2 millions into cryptos, its just 2-3% of their networth.

      Even if they bought and diamond hands Luna to zero, its just a paper cut - no harm; no foul.

      Size has its advantages ;)

      Yup, as to which poison to swallow, and what shoes to wear, its highly dependent on who we are.

      Bad chefs always blame their tools...

      I wouldn't go as far as long and forget though...

      Tell that to those SPH shareholders who feel asleep on the wheel when the signs are quite evident to anyone who paid attention ala Peter Lynch...

      Buy and forget is in the realm of "faith based investing" or relying on "luck" as your whole investment thesis.

      Which is nothing wrong!

      Just look at those who blur blur just bought landed properties in the 70s and never speculated with stocks or any 2nd investment properties.

      They just focused on their careers. Never cared about FIRE or Rich Dad Poor Dad. What's wrong with being a super well paid hired hand?

      If I can, I would choose luck too!

    2. Smol,

      Lol, I didn't want to be so prescriptive in suggesting the assets.

      Freehold property is one of those possible long & forget assets. But still need to monitor economic & political developments of the country or city.

      I think a global mkt cap equity index would be the #1 long & forget asset (it's essentially a bet on the human race). S&P500 index would be a distant #2.

      Those who just bought residential properties & focused on their work depended more than luck. It's more of perseverance & the traditional mindset of career building.

      Some can take a -50% stock market decline & buy more with glee.

      Some can take toxic bosses & sickening job scopes and grin on! Keke!

  2. Replies
    1. Spur,

      Very creative and funny!

      I guess vested interests in cryptos will bifurcate:

      1) Those who already made their 100x with their "one true god" - Bitcoin.

      They will do their best to put down and pour cold water on any other alt coins who dare to muscle on to their turf....

      2) Then there are those laggards who missed the Bitcoin boat.. They are looking into altcoins like Dogecoin, Luna or what not.

      Hoping their chosen altcoins can 100X and dethrone Bitcoin like how Motorola was pushed aside despite being first with mobile phones...

      That's perhaps the greatest nightmare for Bitcoin millionaires!

      Slaughtered by their own crypto mobs!

  3. Snapshot or short term percentages can lie and fool ourselves; but long term average percentage over market cycles doesn't lie and provide the truth! Average of 0.1% difference can mean lots of money to buy plenty meals at hawker centres.

    1. CW,

      That's why I find it amusing self professed LONG TERM retail "investors" track their portfolio performances MONTHLY!?

      I thought only SHORT TERM traders do that?


      Nope. Not going to join you with "precision" at 1 decimal places.

      I'm more kind. I'll stick with average 1-2% can make a big difference over 30 years ;)

      Spare a thought to those 1M65 acolytes who diligently voluntary contributed to CPF; how they would feel when they discover they have compounded 4% over 30 years, while their "reckless" peers who invested in stocks/properties got average 8% over the same period???

      If 0.1% difference can mean plenty of meals at hawker centres, 4% difference can lagi mean more meals at 3 star Michelin restaurants!!!

      Of course, the 1M65 people are speculating when they turn 65, it will be 1997 AFC, 2000 Nasdaq, or 2008 Lehman.

      Hey! 4% compounded over 30 years sure beat "investors" waiting to breakeven one day!

    2. Smol,

      This is a good example when knowing what can long & forget can lead to meaningful retirement bag.

      Using end-Mar 2009 as the worst crash in 90 yrs to begin retirement [but actually a great time to start] ...

      a person who dutifully saves $1,000 a month into CPF-SA at 4%, or $12,000 a year, for 30 yrs will have $700K on 1st Apr 2009.

      Another person who does the same with a S&P500 index fund with dividends re-invested will have $1.8M ... average of 9.1%pa returns. And this is just after S&P500 had already wiped out -56%.

      [Ok ok, seeing your retirement pot go from $4.1M to $1.8M is a body blow]

      A global fund will return less at 7.9%pa, but still a nice $1.44M

      As an old-fashioned Gen Xer, my stance is that it's fine to try out speculations & new types of assets or flavour-of-the-year or flavour-of-the-decade vehicles ...... but have a significant portion in tried & tested assets at the same time.

      The biggest problem is how to prevent people from bailing out of investing halfway when markets drop -10%, let alone -40% to -50%???

      Singapore govt doesn't want this headache, and so it simply offers CPF at fixed rates pegged to low SGD rates ;)

    3. Spur,

      As atheist, I find it a bit awkward to be the one who is always quoting the "Parable of the Talents".

      I remember the nation building papers when shilling 1M65 did quote an old fogey lady proudly sharing she got $1.6 million in CPF through Save More.

      Using your examples, that meant her peers with similar starting capital who pursued the Earn More path could end up:

      1) $6 million in net worth (if by age 65 lucky no market crash!)

      2) $3 million in net worth (if unlucky age 65 got -50% market crash)

      3) Losing most of their CPF savings due to Charlie Brown itchy fingers investments using CPFIS...

      Its like comparing siblings - same parents; different outcomes in life.

      Or classmates during school reunions - those successful in life thank their teachers; those doing not so well complain school never teach...


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