Cup and Handle Pattern

Today I will go into the “Cup and Handle” pattern, which is a chart reading technique that may or may not help you on the road to riches. I don’t advocate its usefulness one way or another, but you should be aware of it because you may be looking at a stock chart someday and think you may see the cup and handle, and you may be right, or you may be wrong.

Mastercard Stock shows Cup and Handle Pattern

Example

The chart above is an example of a cup and handle pattern. The cup is the u-shaped formation underlined in blue, and the handle is the relatively short period outlined in blue wherein the stock reaches back to its high and then sells off slightly. Proponents of the cup and handle will tell you the time to buy is when the stock reverses its “handle” sell-off and then breaks above its prior high. In this chart (of Mastercard stock a couple years back), the buy period is in late August or early September, if you can read the dates.

Patience

One key of making use of the cup and handle pattern is patience. You need to wait for the pattern to develop. Think about the National Football League, when the commentator says the running back needs to be patient and wait for his blocking to develop. It might have been tempting to buy when the stock began to retrace gains it had made early in the chart – during what is called the “consolidation” phase of the stock. If you did buy during consolidation, you may have made out ok, but you may also have had to wait a while before you were proven right. The psychology behind it is that investors make money on the way up (early in the time period shown in the chart), then do some profit-taking perhaps because they see other, better opportunities out there. When old investors sell, new investors come in, while the company keeps improving its profits and cash flow. As the consolidation phase gets later in the cycle, the new investors hold on because they haven’t made their money yet. That’s when the handle forms, and then the company makes new highs (according to cup and handle proponents).

More Patience

You can see from this chart that it takes weeks and months to go through the consolidation phase and to form the cup and handle pattern. If you are a short-term or even a day-trader and you see a pattern that looks something like a cup and handle, it isn’t. Your eyes are deceiving you. Although the emotional cycle of an investor has admittedly been sped up in recent years, a true cup and handle takes a long time to develop and is not a pattern to be used for day trading.

Investors Business Daily

One of the main proponents of the cup and handle pattern is the newspaper (now website) Investors Business Daily and its founder, William O’Neil. IBD puts on one-day training sessions and teaches how to look for and use the cup and handle as its main trading tool. IBD claims to have tested it and it works – that’s their claim, not mine. That said, IBD does a great job identifying stocks that tend to go up over the long term. I am an IBD subscriber, though I don’t trade based on their cup and handle recommendations.

IMO

Again, my only objective is to educate my readership about cup and handle patterns and to recognize one when you see one, when you are spending time inputting stock ticker symbols into free stock chart websites such as stockcharts.com or finviz.com. Make sure the pattern you see has taken weeks or months to develop because, even today, that’s how long it takes for investor psychology to evolve from a profit-taking phase to a more long-term hold phase.

Active vs. Passive Investing

This blogger believes, despite the title, that Active investing is not dead – it is just out of fashion now because we have been in a long-term uptrend in the stock market for the past 10 years. He believes the flow of funds from Active to Passive investments will reverse itself if and when the market goes through a several-quarters-long tough stretch. I understand the blogger’s point, but I don’t fully agree. I believe there is always a place for active investing, but the active investor really has to know their business.

Active Investing

Active investors try to beat the S&P 500 return (usually) by attempting to buy undervalued assets at a good price and then selling them at a higher price. The Strong Theory of efficient capital markets hypothesizes that this can’t be accomplished, but there are investors out there who have done it, perhaps only for a relatively short span of time. The most well-known Active investor out there is probably Warren Buffet. Buffet’s (and Berkshire Hathaway’s) advantage is that they have enough cash to purchase entire companies, rather than small-lot shares of companies. They thereby control the cash their investments generate, which is not the case for the ordinary investor. Anyone who dabbles by buying individual stocks believes that their stock picks will outperform the general market, and so they are inherent believers in Active Investing. “Active” is different than “Activist” investing. The latter type of investor tries to influence corporate decisions in some way – think of Carl Ichan trying to oust various corporate management teams.

Economist Joseph Schumpeter coined the term “Creative Distruction”, meaning that new technologies or processes constantly supplant old ones, thereby rendering the old ones obsolete. Creative Distruction means that there will always be new up-and-coming companies out there growing their profits, taking away from older companies, while growing the overall economy in the process. The creation and the destruction means there will always be opportunities for Active investors if they correctly foresee the Creative Distruction. It so happens that most of the “creation” in recent years has been by tech companies. The high cost (in terms of price to earnings or price to sales) of these tech companies is off-putting to traditional Active investors who tend to be more value-driven. Nontheless, Active investors who have been on top of the “tech wave” and “FAANG” stocks have done well in recent years.

Passive Investing

Passive Investing means you buy index funds. You may tinker with allocation levels among different funds and different asset classes, but you are not trying to pick individual stocks. This type of strategy is lower maintenance, lower cost (in terms of fees and commissions paid to fund managers), and it fits with Modern Portfolio Theory and the Efficient Markets Theory, which posits it is impossible to outperform the index.

It is true that most stocks are correlated, and if it is theoretically impossible to outperform the market, you may as well join in and invest in index funds. It is also appealing to save money by investing in low-cost Index ETF’s through the likes of Vanguard. Also, if you have a day job and a family, then use your mental energy for those tasks rather than looking at your investment portfolio every day. Index ETF’s are a great innovation – themselves evidence of Creative Destruction in the financial services industry.

IMO

My point is to educate you about Active vs. Passive investing, show some examples of each, and get you to think about how you invest in what you invest in within the framework of Active vs. Passive. It may not be “cool” or “macho” to think of yourself as Passive, but it is probably the best way for you to achieve your financial goals.

Lululemon

Everybody in my city seems to be wearing Lululemon clothes. By everybody, I mean almost all women and some men. Lululemon just moved into a huge new spot in the shopping center nearest me. Despite that, during busy times, lines form to get into the place. “Athleisure” wear may be the bane of fashion designers but it is a huge hit among the general population. Lululemon is the best in class.

Canada

Lululemon is based in Vancouver, B.C., Canada 21 years ago by a man inspired to make superior yoga clothing. It quickly expanded to sell all types of workout clothes for women and for men. It tapped into the “Community” and “Culture” notions of shared experience among its customers such that customers feel like they are part of something larger through buying and wearing Lululemon clothing. In addition to its community and shared experience, Lululemon differentiates itself through its commitment to a quality product, patented materials, and innovation as demonstrated by its drive to expand the market for yoga-based clothing.

Stock Price

Lululemon IPO’d at $18/share in July 2007. At its current price of about $168, that means Lulu’s annual return is in the 20%-range – an outstanding investment if you bought at the IPO and held on all of these years. It has grown from a single store in Vancouver to a company with a market capitalization of about $21 Billion in 21 years – perhaps not the compounded growth rate that Facebook has had but a tremendous success story for a traditional apparel company.

Lululemon Monthly Stock Price (from Finviz.com)

The chart above is a Monthly chart going back to early 2011. You will note that Lulu traded within a range of between $40 and $80 from 2011 to 2018. It was thought perhaps to have topped out before breaking through in early 2018 and reaching its current high level. Lulu currently trades at about 44 times current earnings and almost 30 times projected earnings, so it is expensive even for a growing company. Would I buy it at this price? Yes, but I wouldn’t bet the farm on it, and I would own it as part of a diversified portfolio. The market is not saturated with people wearing yoga clothes, especially considering overseas markets, and so I believe there is plenty of room for Lulu to grow.

IMO

I admire great, new, innovative companies and the entrepreneurs and management that have led their growth. Lululemon’s management has aligned and has created a bond with its customers and its community that has driven customer loyalty, such that Lululemon clothes are the staples of many of its customers’ wardrobes. I will be interested to see if Lululemon can continue to capture the same market segments as it continues its international expansion.

I don’t own Lulu (directly – I do through mutual funds and ETF’s), and my opinions about the potential future performance of Lulu stock is worth what you have paid for it. That said, if you are interested in more “top down” analyses of individual stocks such this, please contact me and we can perhaps come to some arrangement.

Wins Above Replacement

Major League Baseball has a relatively new statistic called Wins Above Replacement, or WAR. WAR attempts to quantify the value of each individual player by determining how many team “wins” that player is responsible for relative to a replacement player whose statistics and metrics are the league average for that position. For a player, any WAR number that is +1 or above is good because it means that player is better than the average player. If you are a player and your WAR is +5 or more for a season, then you are likely one of the top 30 players in the league: an All-Star or an All-League player. Other sports have similar metrics, but it is most advanced in baseball.

Suggestion Box

I was speaking with a good friend who just visited me, and we were discussing how companies value their employees, and that while some employees are overcompensated, others, especially employees who develop new ideas that result in higher profits and/or lower expenses for the company, are undercompensated, sometimes vastly so. My friend provided an example of a company that had a Suggestion Box and paid $25 to an employee whose suggestion was implemented. That’s a great “bang for the buck” way for that company to get good ideas from the workers in the trenches!

WAR for Business

That conversation made me think of WAR in baseball. The idea of WAR is to quantify the value of each player. Is there such a thing in business? Can each employee of a company have a “Value Above Replacement” quantity that clearly states how well this employee has performed, or how much better or worse this employee is relative to an “average” employee in the same position? At this point, the answer is that there isn’t such a quantity, but I would not be surprised if we move in this direction, because other businesses, especially sports and entertainment-related businesses are moving in this direction. MLB players whose WAR is 5 or above sign contracts worth $10’s of millions or more. Actors whose films or shows have higher ratings or box office numbers can command much higher contracts for their ensuing work. If an employee of a company can definitively demonstrate that their work has resulted in more revenue or fewer costs for their employer, why shouldn’t they have the right to share in the increased net profit?

Stock Options and Profit Sharing Plans

Some companies already do have plans to share profits through stock options and/or profit sharing plans. For public companies, stock options have been a thing for many years, but recent regulations have made it more difficult and costly for firms to issue some types of options. For private companies, profit sharing is still done, but such a plan requires the willingness of the employer to offer the plan. Also, plans such as 401k matching and bonus plans also work toward sharing corporate profits, and Performance Review grades are a way of assigning numbers to employees. However, Performance Review grades are good in that company but may not translate to another company.

IMO

The point that I want to make here is that each employee should think in terms of the concept of WAR, meaning how do I, as an employee, do a better job than another “average” employee off the street would do? If you approach your job with the mentality of “how can I do a superior job?”, then you will do things like take ownership of problems your company may face, or try to make your direct boss’s job easier. It will also hopefully raise your mental state above just going in and doing your job every day into thinking about how you can be a superstar. In terms of financial planning, there is no financial plan better than attempting to do your best at work and to try for the highest salary, bonus, stock options, or other profit sharing concept your company might have. Because, as well as you do this year, you will then probably build on it next year and thereafter, and before you know it, you will have exceeded your financial expectations that you had when you started out.

Robinhood.com

If you are looking for an easy way to open up an account and to invest in the stock market, try Robinhood.com. It’s so easy, you can do everything from an app on your phone. And, if you keep to the basics of trading stocks or ETF’s without using margin, you will pay $0 commission! Free access to financial markets – it doesn’t get much better than that!

Invest Commission-Free on Robinhood.com

App

Robinhood was designed from the beginning to be used primarily via a phone app. They are thereby appealing directly to the Millennial Generation – a good idea since they are younger and more likely to remain customers for a longer period. Millennials do everything else through an app; why not investing? However, if you download the Robinhood app, you are asked to input your email address right away, prior to being able to explore the site. So, it is maybe best to explore the website first through your computer prior to downloading the app on your phone.

Business Model

Robinhood believes that it can make money without charging commissions because Robinhood doesn’t have the internal entrenched overhead expenses that other brokerage firms have. Instead of through charging commissions, Robinhood makes money through three different revenue centers:

  • A $5/month subscription service called Robinhood Gold which offers margin (the ability to use leverage in your account) and other higher-level features, plus additional margin interest Robinhood charges above $1,000 initial margin interest.
  • An interest rate spread – the difference between the interest it makes vs. interest it pays out on money deposited with Robinhood – much like any other bank; and
  • Trade rebates from market makers and trading venues.

I’m guessing that the additional margin interest and the interest rate spread are where Robinhood makes the bulk of its money. You can see that if you don’t trade on margin, you really can trade commission-free!

Competition

Vanguard seems to be the closest competition to Robinhood. Both Vanguard and Robinhood state their Mission is to democratize investing, and both do in their own way. Vanguard is also commission-free for most of its own ETF’s, and for the individual investor, it is safer to invest in ETF’s than with individual stocks. Robinhood’s advantage (from the Millennial standpoint) is that one can invest in Cryptocurrency (Bitcoin and the like), which can’t yet be done on Vanguard. Vanguard and other competitors (Schwab, TD Ameritrade, and the like) also have invested heavily in apps, but they all charge commissions, although it is likely that they offer more features than does Robinhood. Robinhood has its own brokerage firm, Robinhood Financial LLC, which is registered with FINRA, and its accounts are insured up to $500,000 through SIPC, as with most other FINRA-registered firms. At this time, Robinhood only offers regular, “taxable” accounts – no IRA’s and the like, which is unlike the other major discount brokers. You can set up your Robinhood account to easily transfer money from your standard bank checking account, and Robinhood is currently working to add more cash management services.

IMO

If all you want is a basic entry into the stock market in a no-frills way using an app on your phone (because you are always on the go and can’t always be at your home computer when you want to trade), and you have a VPN on your phone so that you are protected when you use the WiFi at Starbucks or other public WiFi, then Robinhood may be right for you. My advice is to be careful if you decide to go with the Gold option and start to pay $5/month plus possible additional margin interest expense. If you want the app feature and don’t mind paying some commissions when you trade, then look at the other major discount brokers. All that said, kudos to Robinhood.com for developing this site and for their success thus far! BTW – I am not associated with Robinhood and am not being paid to write any of this.

The Amygdala

The Amygdala is the part of your brain that plays a “primary role in the processing of memory, decision-making, and emotional responses, including fear, anxiety and aggression.” (Wikipedia). Studies of human behavior related to investing show that the amygdala kicks into high gear during periods of stock market volatility and/or during market corrections. Fear generated by the amygdala is why people tend to sell while the market is cratering, buy when the market is at a high, and generally not to act rationally.

Your emotions emanate from your Amygdala

Economic Man vs. Amygdaloid Man

Most economic theory has the base assumption that the investor is always rational and always acts in their own best interest. For instance, the “efficient frontier” theory says that an investor will always choose an investment that provides them for the highest possible return for the lowest possible risk. This is all very rational and machine-like. Nobel laureate Richard Thaler calls this the “economic man” theory, after which he proceeds to shoot holes in that theory. Economic Man assumes that such man doesn’t possess an amygdala, or at least that they are able to squelch any input that the amygdala and its onslaught of emotion and fear will have on one’s ability to make rational decisions, especially during volatile markets.

Contrast “Economic Man” with “Amygdaloid Man”, wherein most if not all decisions are made by gut instinct and ruled by fear. Which do you think is closer to the way most investors make decisions about how and when to invest their money? They probably know they should be more rational and they even may try to do so, but the amygdala is very strong and more than counteract any rules or rationality one tries to use when they invest.

Quantitative Strategies

It is for this reason that the investment world is moving in the direction of quantitative, computer-based trading strategies, specifically to try to keep the fear and emotions out of the decision-making process. If an investment manager relies purely on rules, or, better yet, on proven quantitative models for how and when to buy or sell securities, studies show that such an investment manager is more likely to achieve the ultimate goal of investing, “buy low and sell high”, and thereby make money for their clients and themselves.

IMO

We are in a period of higher stock market volatility. Please try as best you can to keep your foot on your amygdala and to not get too involved with the day-to-day ups and downs of the stock market. One good way to keep your amygdala at bay is to work closely with a professional investment manager (such as myself!). If you work with a professional and at least talk through decisions you are considering, you are much more likely to make a better, more rational decision and to establish goals, plans to meet your goals, and to stick with your plan.

2019 vs. 1999

This article from one of my new favorite websites, Medium.com, was written by a former tech entrepreneur who sees similarities between 1999, the last year of the “dot com” boom prior to the crash of that market that started the next year, and this year. The author provides anecdotal evidence, such as rich tech guys shopping for private jets, company CEO’s achieving celebrity status, and a strong tech jobs market, as evidence that we are perhaps about to face a stock market crash similar to that which happened in 2000-2001. I disagree with the author’s assessment, and for the following reasons:

Chart of NASDAQ During Dot Com Era, Including 1999
  • Capital Markets Are Tighter: Yahoo.com had its IPO in 1996 after having been formed a year prior. Pets.com, DrKoop.com, Webvan.com, and other examples from 20-25 years ago were all nascent companies with nothing other than an idea and easy access at the time to public capital markets. Compare that with recent IPO’s such as Uber, Lyft, and even Facebook, all of which were well established with years of an operating record (albeit one of net losses) prior to their IPO’s. The point is that not everything with a .com is being financed now, and for those companies that are financed, the weeding out process is taking place in the private markets now, prior to IPO. There is still plenty of failure among start-ups, but the difference is these are not publicly-traded companies. One could argue that the pendulum has shifted too far in that it is now overly difficult to navigate into the open waters of the public markets. Regardless, retail investors are no longer investing directly into start-ups as they effectively were in 1999 and just prior, and the media does not focus on start-ups that fail prior to IPO.
  • Job Skills Are Lacking: Young people who can code are earning $6 figures (as the Medium.com author laments) because they are unique in that they possess the minimal skills needed to break into the tech world. Ask any employer and the lack of skilled workers is among the most difficult problems they face. Our educational system is not properly geared to turn out workers with the skills needed in today’s marketplace. This is not to defend these kids and their haughty attitudes – there is no justification for acting like you are God’s gift when you land a job as a coder that pays well.
  • Celebrity CEO’s Are Not A New Thing: Corporate pioneers have often been eccentric. Think of Howard Hughes. J. Pierpont Morgan, Henry Ford, and John D. Rockefeller were all well-known figures during their own times. Despite the “politics of destruction” that we have today and the patches of resentment that follow the titans of industry, Americans have always had a high level of fascination and respect for industry veterans who have helped to make their own lives better or more interesting. I don’t view the current focus on Zuckerberg, Bezos, Musk, et. al, to be historically out of the ordinary.
  • Market Fundamentals Remain Good: Corporate earnings are strong and are getting stronger (perhaps at a somewhat slower rate than before; the P/E Ratio on the S&P 500 is currently under 18 (per the WSJ), which is not overly high and is lower than a year ago; and interest rates are low, as the 10-Year US Treasury yields less than 2.5%. Our economy remains strong and there is little indication that a recession is near or that the stock market is about to crash.

IMO

Of course, I could be wrong, and we could start a big correction tomorrow. Geopolitical risks seem to be driving a higher level of market volatility, and these risks could escalate at any time. Debt at all levels of government is already high with no indication that deficit spending will abate. So, there are risks out there, but I don’t see 2019 as a replay of 1999.

Move The Rocks

Last week I wrote how important it is to have a plan for each day and to execute on that plan. Today I am writing about how to prioritize all of the tasks that you have or that you give yourself on any given day.

One Way of Prioritizing Your Daily Tasks

Rock, Pebbles and Sand

I am inspired by two articles: This one by Jari Roomer posted on Medium.com, and this one about the Rock, Pebbles and Sand theory that is currently popular in the blogosphere. Both have a similar message: that you need to prioritize based on what acts or tasks will be the most consequential toward achieving the most important goals that you have. These are the “rocks”. Move the rocks first, and make it a priority to move the rocks, because they are the largest and require the most thought and energy, but have the most impact. Once you have moved the rocks to where you need them to be, then you can turn your attention to the pebbles (somewhat easier to move but still lumpy), and then to the sand (fine particles that fill in the lumpy spots) if and when you have time. In his article, Roomer discusses the 80/20 rule, where 20% of your daily tasks result in 80% of the impact you desire. Like rocks.

Do the Biggest Task First

Another variation on this theme is to complete the biggest task first, when you are freshest of mind and have the most energy. I am a morning person so I like to work first on those tasks that require the most tasks or energy. Once I get those done, I feel like the remainder of the day will be easy relative to what I have already accomplished, and that if I don’t get much more done for that day, I can consider my day to have been at least a small success. For me, talking to people on the phone or in person doesn’t require as much energy as does just sitting there and thinking about writing or solving problems, so I tend to schedule my conversations (if I have a choice) for later in the day.

Allot a Finite Time

Roomer says one should go so far as to allot a specific amount of time for each task during the day. He refers to Parkinson’s Law, which is that work tends to expand to fit the time allotted to it. Setting a goal of 2 hours, for instance, to accomplish a task also is a way of taking control of the situation and not to let the event take control of you. When you have an in-person meeting or a call, you typically set a deadline for when it should end. Why not do the same thing for a task that you are working on? If you have an urgency to finish something, self-imposed or not because you have other things to do, then you may devote more mental or physical energy to that task and you may do a better job with it. Doing so may also allow you to pay attention to some of those pebbles and sand that otherwise you may not have time for.

Create Value

Roomer’s advice is, “The only thing that matters is the value you create.” He means Value in the broadest sense, not just building something that someone else will buy for a higher price. Think about everything you do in terms of creating value for yourself or others, and you will see what you do every day in a different light.

IMO

The “Rock, Pebbles and Sand” concept provides you with a good visual way to look at your tasks and to decide which are the most important. Roomer’s article is more specific as to how to prioritize. Both get to the same point, which is that some things are more important or more impactful than others and that you should prioritize those things so that you will feel a sense of accomplishment.

Check Your Beneficiaries

I was unfortunately reminded of this maxim recently. Make sure you check your account and asset beneficiaries with every life event, and at least once every year! You may say you don’t what happens after you die, but you really should want your money that you worked so hard to make or save or your life insurance proceeds that you paid for all of these years to go to the person that you intend for it to go to. It would be a shame if your wishes don’t happen.

Check Your Beneficiaries!

Life Event

Marriage, divorce, birth, and death are the most frequent life events. Things like beneficiary statements tend to fall through the cracks with a divorce because you are probably in a mindset to move forward and not to look back and deal with stuff during a bad part of your life. However, you could be talking lots of money, and if assets are not divided up by family court, and even if they are, it is very important to make sure you change your beneficiary statements after you divorce. Then, if you remarry, you will need to change them again if you want your new spouse to inherit your wealth. Have you had children or even grandchildren during the past year that you want to include in your estate? Make sure their names are included as alternate or sub-beneficiaries if you can do so.

Family Trust

Although it is not a “life event”, the formation of a family trust is of similar magnitude. Make sure your beneficiary statements reflect your new family trust, at least as the alternate beneficiary, since some accounts require the spouse to be the primary beneficiary. It may be worth it to obtain the spousal consent required and to make the family trust the primary beneficiary, especially if you and your spouse are the trustees of the family trust. Why do this? Because assets in a family trust will avoid probate, whereas assets not in a family trust may not avoid probate.

Beneficiary Statement Takes Precedence

You may say, “I have a Will that says my spouse inherits everything. Why should I change my beneficiary statements?” The answer to that is that beneficiary statements take precedence over a will for specific accounts. If you have life insurance, the insurer will pay the benefits directly to the named beneficiary, regardless of what the will says. A dirty little secret is that a will isn’t worth much if your accounts have named beneficiaries, which they likely do, and if you have a family trust. A will is more useful if you have or own assets in your own name free and clear and wish them to pass to a specific person, and even then they may need to go through probate.

How

How do you change a beneficiary? Simple. Go online to the home page of the bank, brokerage, insurance company, etc. where your account is. Likely there is a “Forms” tab. Find the Change of Beneficiary form, fill it out (make sure to include the account number), sign it, and send it in. While you are on the site, you can log into your account and hopefully it will tell you who the current beneficiary is.

IMO

I can speak from personal experience that these beneficiary designations fall through the cracks and need to be proactively updated more often than you probably do. If you don’t keep them updated and then you tragically pass away, it could leave a real mess for your loved ones to deal with at a time when they likely aren’t emotionally equipped to do so. Save them all a big headache and make sure your beneficiaries are correct and current while you are still alive.

Plan Each Day

This article on Medium.com proposes 5 steps that you should do each day to plan what you want to accomplish for that day. I agree with it wholeheartedly. In order to be successful, however you define your own success, you need to have a plan for each day and determine how and when you plan to accomplish your daily goals.

How Do I Plan Each Day?

Especially for People On Their Own

I believe a Daily Plan is especially important for those of us who are on their own, meaning those who don’t go to a steady job every working day. If you have a job and work for someone else, perhaps your day is planned for you and your only plan is to complete the tasks provided to you. However, if you are on your own in any capacity, Daily Planning is a must. If you are on your own, there will be many distractions that will be more fun or interesting than what you really need to accomplish on any given day. I speak from experience on this matter.

Sense of Accomplishment

Your goal every day should be that at the end of each day you will have accomplished part or all of what you set out to accomplish at the start of the day. If so, you should feel good about yourself. What if you get to the end of the day and you got done part of what you hoped to but not all of it, and you are angry with yourself for not getting it all done? Perhaps you have set too high of a goal for yourself. Maybe there isn’t enough time in the day for you to get done all that you desire. If so, for tomorrow and future days, set more realistic goals. You want to feel that you move the pile forward every day, even just a little bit, and you should give yourself a pat on the back for having done so, even if you perhaps moved that pile only 3 inches instead of the 6 inches you had hoped to.

IMO

What does all of this touchy-feely babble have to do with financial planning or investment management? Well, the second word in financial planning is “planning”. Whether you plan for your entire financial life and well being or whether you plan just for what you hope to accomplish today, the planning element is an essential part of the process. Both Ben Franklin and John Wooden, the Wizard of Westwood, said some version of, “Failing to plan is planning to fail.” Essential advice from two different American sages!