Balance: How It Puts Money In Your Pocket, And How You Can Achieve It

I just revisited the past 30 years of my trading journals. The objective of my little research study was to investigate whether there was a discernible correlation between my actual annual investment performances and if they were impacted by what I’ll label as my “personal annual equilibrium score”. That’s the score I assign myself with an A through D grade each year. Let’s not get into 2020 being the outlier year it was.

The unequivocal answer was “yes, indeed!” It also produced reason #327 as to another benefit of keeping a trading journal. In my estimation, 30 years is a statistically significant sample size for this type of query. In my next book, I will summarize reasons #1 through #327 as to why every serious investor would benefit from keeping a personal trading journal. But that’s for another day.

The interrelation was clear. In those particular years, I scored: the highest “Balance Grade”, my investment performance was stronger as well. The inverse was also true. My life and my investing were measurably better when my personal equilibrium was on an even more solid footing.

I did consider the reverse as well whereby life’s balance was driven by the degree of my success in the markets. My journal notes, however, negated that theory. My life’s balance seemed to be the driver of my market success. Balance was part of the investment equation as well. Here’s why. I’ve written about this before but my trading journal makes the case that it was my asset allocation skills (balanced investing) and less my stock-picking skills that produced the superior results.

My journals support the proposition that to achieve outperformance in your portfolio, you need to ensure that both balance in your personal life and balance in your investing life work together simultaneously — whether that investing balance is asset allocation, diversification or whatever label you care to use. My point being that plunging into the “hot” stocks of the day is not a consistent profitable long-term strategy. 

You might think of this similar to the ancient Chinese philosophy of Yin and Yang which represents the concept of dualism. How contrary spheres in life might actually be interconnected and complementary. This, I believe, is the case here between one’s personal equilibrium and one’s investing stability. 

So here are some key observations made from my Trading Journal review research.

  • The greater the tension in one’s life balance, the higher the likelihood that tension will be transferred to one’s investment efforts and results.
  • A preoccupation with the past and the future produces fear and anxiety in both spheres — personal and investing. Your focus needs to be on the “now”.
  • When you venture beyond the edge — where you jeopardize your stability — success will become out of reach. Allowing yourself to become consumed by either financial or personal goals will hurt both.
  • Losing control of your time and routines will lead to losing your evenness in life and investing.
  • If you neglect your exercise, health eating or proper sleep, you’ll deplete your ability to maintain your balance.
  • Your portal to personal performance is to commit to maintaining both your life balance and investing balance.

That said, I’d like to encourage you to pursue improving your personal balance in both spheres — your everyday life and your investing life. Promise yourself to explore those tools and apps that are available as you undertake your own action plan. Here are just a few examples of tools that could be helpful for you.

  • TIMENEYE — it’s a basic personal time tracking app that monitors how you spend your time. It syncs with Google Calendar as well.

  • Workout apps such as TRIBESPORTS can help you regularize your workouts. This arenas has many options you can explore. I will admit that I do like my Apple watch for this purpose. 

  • Based on the Pomodoro technique, FOCUS BOOSTER is an app that helps you set “focus time” that can be a powerful productivity aid. 

  • WAY OF LIFE is an app that can help you purge your bad habits and develop helpful ones. It displays charts, trend lines and scoreboards for those who relate to visual analysis.

  • COJI FAMILY ORGANIZER is an app that helps you manage family schedules, appointments and activities. It also syncs with Google Calendar. 

  • STRESS TRACKER is an app that helps you minimize or eliminate stress. It does this by capturing stress levels with “insight tools” to identify your biggest stress triggers and teaching you to avoid them.

So there you have it! My Trading Journal taught me this fundamental principle — a balanced life is a more profitable life. As the old saying goes, the best time to plant a tree was 20 years ago, but the second best time is today.

Trade well; trade with discipline!

– Gatis Roze, MBA, CMT