The Psychological Impact Of Maximum Drawdown (MDD) on Portfolio Management
I suppose everyone is still in the holiday mood after celebrating Christmas with our loved one and about to countdown the arrival of 2022, a new chapter or year in our journey of investment and I will try to keep this blog post short. There is one very important topic I would like to highlight here before the closing of 2021, i.e “ The Psychological Impact Of Maximum Drawdown (MDD) on Portfolio Management."
For every investor, I think drawdown should be one of the most important topics to understand when you start to learn about stock investing. Even before talking about gains or returns you expect from your investment, one should really and clearly think about “how much I can stand or “tahan” to lose from the investment? what are my risk tolerance and maximum drawdown I could stand when looking at my portfolio in RED, especially the psychological impact of losing sleep or stress?
e around? I really don't know, but again, make sure you do understand your "risk tolerance " and have a diversified portfolio if you want to venture into the HKG market.
Will more loose monetary policy in China help to add some stimulus to some of the sectors which are still struggling like property and techs?
Diverging monetary policies in US, China may provide some balance to global economy <source: straitstimes.com>
Well, we are seeing some good news or data on Covid-19 from South Africa and UK in regards to Omicron, do hope that this Omicron will be the last VOC ( Variant Of Concern). I am still positive on this and fingers crossed.
Taking this opportunity, I would like to wish all :
" A very Happy and Prosperous (Huat) Year 2022 !!
Till next update!
A good write up from Kyith (InvestmentMoats.com) :
How to Manage Your Fear of Loss and the Maximum Stock Exposure You can Tolerate to Remain Invested Longer