(Falling in)……………

2002 Hollywood movie “Enough” saw the lead character played by Jennifer Lopez endure constant physical abuse at the hands of her husband before taking control.

Similarly, the 1944 film “Gaslight” has the lead character manipulated by her husband till she teeters at the brink of madness.

In her memoir Crazy Love (2009), the American feminist writer Leslie Morgan Steiner details the domestic violence she suffered during her four-year relationship with her ex-husband Conor. He choked her, punched her, banged her against a wall, knocked her down the stairs, broke glass over her face, held a gun to her head, took the keys out of the ignition on the highway.

Steiner’s love for her husband was irrational. Steiner didn’t stay with her husband even after the abuse due to fear, it was love. Even when he broke a glass frame over her head, her only thoughts were: ‘Don’t let this happen. I do still love him. He is my family.’

Love is often viewed as an emotion that defies other emotions to the extent that other emotions are believed to be subject to justification or rationality while love is often irrational.

Reasons for love are often found to be vague or non-existent. Common answer being “I don’t know, I just do”.

Of-course push comes to shove people often rationalize their love and find reasons.

Its Chemical

Testosterone, estrogen, and dopamine are the chemicals that incite romantic entanglements.

So far so good hormones are released, making us feel good and rewarded. However, love is often accompanied by jealousy, erratic behavior, and irrationality.

So, you can see the downside behavior is a result of what causes the upside.

For example, Testosterone has been found to incite aggressive behavior while dopamine impacts virtue and vice equally and has been found to cause addiction.

The good comes with the bad and is unavoidable.

Love creates attachment, attachment can create overly protective feelings leading to the need for ownership and guarding the feelings even more strongly.

Falling in Love with your investment

“Never fall in love with a stock; always have an open mind.” Peter Lynch

For investors this can be dangerous attribute to have.

Falling in love with your stocks/investment is a very common phenomenon.

Investors can fall in love with a thesis.

If the thesis bears result in the short-term, the outcome becomes the process making a person feel even more attached to the thesis.

This leads to investment going beyond investment and becomes personal.

All sense of rationality needed so badly in any investing decision gets thrown out of the window.

Everything associated with the investment only looks rosy.

The meme-stock phenomenon is its best example.

What to do?

I will just present a few statements to clarify this (emphasis is mine):

“We document our analysis and valuation not only at the beginning, but also by formally revisiting everything in writing at least twice a year.

It’s easy to get married to something you own and if it’s not working to change the reason you are still in it.

We find this a very good exercise to help prevent that kind of thesis creep.”

David Hurwitz

“Never fall in love with anything! If facts change, re-evaluate your position!” James Dinan 

If we only confirm our beliefs, we will never discover if we’re wrong.

Be self-critical and unlearn your best-loved ideas.

Search for evidence that disconfirms ideas and assumptions. Consider alternative outcomes, viewpoints and answers.” Peter Bevelin

“Pride is a great banana peel, as are hope, fear and greed. My biggest slip-ups occurred shortly after I got emotionally involved with positions.” Ed Seykota

In a nutshell, once you own something basis your thesis, re-evaluating on a periodic basis while keeping your emotions aside can help take a better view on the security.

Remember the security doesn’t or care that you are in love with it.

So, keep your unrequited love out of the way of your investing journey

Happy Investing

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