Lesson 6 of 8
FOMO & Building Discipline
How to stop making emotional trades
DALBAR 'guess right' ratio
25%
investors timed correctly 1 in 4
Miss 10 best days
-50%
returns cut in half
15yr losing streak
2009-2024
avg investor vs S&P 500
FOMO trades
Buying after a stock already ran 200%
Chasing crypto/meme stocks at the top
Panic buying when everyone's euphoric
Result: bought high, sold in panic
Disciplined trades
Buying on a schedule regardless of news
Ignoring daily price movements
Having a written plan before you invest
Result: captured full market returns
Write down your investment plan: what you'll buy, how much, how often
Automate it. Set up recurring investments so you don't have to decide.
Delete price alert apps. Check your portfolio once a quarter, max.
When you feel the urge to trade, wait 48 hours. The urge usually passes.
Remember: the best investors are dead people (Fidelity study) because they literally can't panic-sell.
the fidelity study
Fidelity reportedly found their best-performing accounts belonged to people who were dead or forgot they had accounts. The lesson: doing nothing beats doing something almost every time.
Check yourself
According to DALBAR, how often did the average investor correctly time their market entry/exit in 2024?