The Desire to be Different

We all aim to be different from everyone around us. We try to be a little different in our fashion sense to present the world our very own identity and sometimes in attempt to be at the center of attention. There are times where we aim to express our unique views and ideas so as to gain the recognition of our peers, professors, or colleagues. We are compelled by our innate competitiveness to flaunt the qualities we have and perhaps that is how we have survived till today. We are good, we are above the competition, but we are getting cockier.

Increasingly, the human population does away with the old traditions. We see youngsters visiting relatives wearing black on Lunar New Year (a taboo), youngsters dropping out of school thinking it is cool or they can be extra successful, and the technical STEM is no more as popular as before. The observation is that we are constantly trying to be different.

The desire to be different is good yet it can be dangerous in certain scenarios like some Tiktok challenges that pose a health hazard, eating raw meat or even rotten meat to start a new diet trend, or in our day-to-day investing.

Because we like being different, we may attempt to delve into all sorts of investing strategies using novel indicators like how the moon may predict our trades or going into riskier strategies such as that of options, crypto, and forex. These trading strategies may work for some and no doubt a small handful makes a fortune out of them. I am curious to know if the average results of everyone that attempted these strategies would have beaten the traditional way of investing in stocks.

Our over-competitiveness further exacerbates our lust for being different. Because if we were to conduct our standard dollar-cost averaging into the market, we will never beat the market. There is no bragging value to the people around us. In order to partake in higher returns, we often take on higher risk and that is not necessarily a good thing.

We have to understand that sometimes doing the same thing provides us the peace to sleep at night – especially for passive retail investors. There must be a reason why a certain strategy has survived till now – not because there is a lack of supply but rather a lack of successful ones over decades. Remember, it is easy to win a coin flip thrice in a row, but not thirty times in a row. Because most of us are perhaps not in investments as our full-time jobs, we may not have the skill or time to consistently keep a lookout on our portfolios which may mean our more active, defiant strategies may not garner the returns we seek.

I had the privilege to have a chat with 2 seasoned asset managers awhile back and having learned that the team adopts a contrarian view to generate alpha (returns excess of the market) in a certain geography. Naturally, I was intrigued. At the end of the chat on behavioural finance and investing methodology, I was able to surmise that being different is totally fine as long as we keep our biases in check. This is on the basis that we conduct stringent analysis and due diligence before believing in what we are investing.

Perhaps, the best humble brag would be to see our wealth grow consistently and safely. The goal is the long-run end accumulation not short-term satisfaction. Unless we have the capital and discipline to be able to fully devote our lives into actively researching for the next best deal, perhaps it could pay off to be traditional for certain things in live.

If you're interested to chat on this topic or to exchange ideas, please feel free to drop me a message on Telegram @elijah2212, LinkedIn, or through email elijah.thj@gmail.com!

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