ROMO & FOMO | 15 | the Patron
ROMO is an abbreviation of Regret Of Missing Out and FOMO is an abbreviation of Fear Of Missing Out, however the The Oxford English dictionary has a far better explanation,
[mass noun] Anxiety that an exciting or interesting event may currently be happening elsewhere, often aroused by posts seen on social media:‘I realized I was a lifelong sufferer of FOMO’
I know it’s been a awhile since I last put pen to paper, and one of the reasons is due to my account being in a position of mostly cash as I figured out what my next move would be.
I will admit…I was hasty in taking profit and I could have parcelled my way out a little better, perhaps taking 20% off the table at a time.
The consequences of exiting too soon, was missing out on more profit, even though I achieved my original goal.
Previously I wrote about how I completed my 3 month trial period and I managed to exceed my goal of 7% return by an extra 5% over 3 months.
I experienced a sense of success and accomplishment, which has been replaced by something else…ROMO (Regret Of Missing Out)
I then watched as the stocks I exited began to soar by more than 50% and suddenly the good vibes had left me as I regretted selling out too early.
A week ago I had 80% of my account in cash, and thanks to ROMO I felt the need to do something, to try make up for what I missed and I felt the need to buy and start trading again.
Moving on from ROMO, I began to experience FOMO, and it is something many of us suffer from and it is what I am beginning to identify in my own life and journey as a beginner trader.
After being patient for 3 months and making 12% profit, I had roughly a week of ROMO, which was followed by FOMO and so I decided to enter into some of the miners (around 2/3 of my capital).
This may not seem an issue to those who are not following the precious metal sector, except the past week has seen the miners being sold off, which means my account is no longer up by 12%, instead it’s up by 7%.
I want to use this moment to reflect on why I entered into the market too soon, and I believe it was my lack of experience which allowed ROMO and FOMO to take control of my good judgement. No one pressured me into re-entering, I did that by myself and I will even go so far as to say my logic and commonsense was affected!
Looking back at my reasons and doing a “debrief” is how I learn, through experience and self assessment.
I need to learn from this error and put controls in place to help me trade unemotionally.
I am clearly still a beginner when it comes to trading, and I remind myself of an analogy someone once told me, “Professional golfers didn’t get where they are without first losing a few golf balls”
If the analogy suits, then I can expect to lose some capital in my journey to becoming a better trader.
I thought this my trading began last year, but I see the journey has only just begun.