STE's Stocks Investing Journey

Today I want to share something I genuinely enjoy and honestly, something far more important than endlessly crunching numbers or tweaking valuation models. Investing isn’t won on spreadsheets alone. P/E ratios, discounted cash flows, and balance sheets matter, but they don’t explain why markets panic, overshoot, or stay irrational far longer than they should. That part is human. Remember John Maynard Keynes' most famous quote on market irrationality , "Markets can remain irrational longer than you can remain solvent," highlighting that speculative bubbles or crashes can persist far beyond what logic dictates and emphasizes the unpredictable nature of financial markets and the risks of betting against them, even when you believe they are mis-priced or irrational. At its core, investing is about people. Markets are a giant arena of emotions : fear, greed, overconfidence, and herd behavior playing out in real time. For value investors, this is not noise to ignore; it’s the ...

Over the years, I’ve realized that investing isn’t really about finding the perfect stock or predicting the next big move. It’s more about how we think. Two people can look at the same balance sheet, the same chart, the same news, and walk away with completely different conclusions. The difference is rarely intelligence. It’s the mental model they’re using, often without even knowing it. Mental models are just ways of understanding the world. Simple ideas that help us make sense of messy reality. In the stock market, where noise is loud and emotions run high, having a few good mental models can keep you grounded. Not to make you smarter than everyone else, but to stop you from doing stupid things at the wrong time. Here are some mental models that have quietly shaped how I navigate the market. <Ai Image> The Pari-mutuel System The stock market works more like a betting system than most people realise. In a pari-mutuel system, your payoff doesn’t depend on whether you’re right...