"What was I thinking when I bought that pig?"
How many times have you asked yourself that question? Don't worry, you're not alone. It's an all-too-common lament among individual investors, whose portfolios are often littered with these losers. Almost as bad as the financial hit is the nagging related question, "How could I have ever been so stupid?"
Today, we address that issue. Included in our discussion are two basic tools that will help you look back and understand your own thought process, and the analytical steps you took -- or failed to take -- before buying that sow. More importantly, this process can help before you buy the next pig.
The Best Constantly Improve
Developing a way to both evaluate and improve your performance is one of the most important skills any investor can have. Yet far too few individuals have a mechanism by which they can review their stock picks, evaluate their trade management and assess their market calls.This is a pity. Constantly reviewing your trading, recognizing what went wrong -- and right -- and adjusting your methods on the basis of what you learn is one of the simplest ways anyone can improve their skill set. Reviewing strategy for weak spots and making incremental improvements is especially important for the