Blog

There’s a paradox in markets that most investors never see because they’re too busy chasing noise: the gravitational pull of boredom.

We live in a world of alerts, Discord pings, and CNBC chyrons screaming BREAKING NEWS every half hour. It’s like standing in Times Square — your attention is constantly hijacked. And yet, markets don’t usually reward the loud moments. They reward the quiet ones.

Take the classic Stanford marshmallow experiment. Kids who resisted eating one marshmallow immediately in exchange for two later went on to show better life outcomes. Investing is just a grown-up version of that experiment. The marshmallow is the hot trade your group chat won’t shut up about. The second marshmallow is compounding — slow, invisible, boring.

But boredom has a gravity of its own. It pulls you away from the dopamine high of overtrading. It forces you to sit still. And when you sit still long enough, you notice what others miss: that wealth accumulates not in the rushes but in the pauses.

The dot-com millionaires? They weren’t the ones trading Pets.com back and forth. They were the ones holding boring old Amazon through years of unsexy, sideways charts. The crypto investors who made it? Often the ones who survived the winter by doing nothing — no panic-selling, no frantic buying, just holding and dollar-cost averaging.

There’s even research showing that traders with fewer screen hours often outperform the glued-to-the-monitor types. Why? Because constant exposure makes you itchy. You see every tick, every shadow move, and you start reacting instead of thinking. Boredom, by contrast, builds patience muscles.

And patience is an edge.

The trick is reframing boredom not as a void but as a signal. If you’re bored, it might mean you’re finally in the zone where compounding works. Like watching paint dry or grass grow — nothing seems to happen, until suddenly everything does.

So next time you feel restless, craving that rush of action, remember: gravity doesn’t need fireworks. It just needs time. And if you can align yourself with boredom’s pull, you’ll realize it’s not a drag at all. It’s propulsion.

🔑 Key Takeaway: In trading and investing, boredom isn’t your enemy — it’s the hidden force that pulls wealth toward you, if you let it.

There’s a paradox in markets that trips up even smart traders: the belief that more action equals more progress. Check your phone more often, refresh charts, trade the micro-swings — surely that’s how you “stay sharp,” right?

Wrong. Welcome to the Churn Trap.

A Churn Trap is when you burn energy, fees, and emotional bandwidth without moving forward. It’s like running on a treadmill: exhausting, sweaty, even thrilling at times — but you’re still in the same place.

Why Churn Feels Productive

Psychologists call it action bias: the tendency to prefer “doing something” over sitting still, even when stillness is the optimal play. Soccer goalkeepers, for example, dive left or right on penalty kicks — even though statistics show standing in the center often works best. The crowd rewards the appearance of effort, not the result.

In trading, action bias becomes churn. You get sucked into rapid-fire buys and sells, mistaking motion for mastery. Each click feels like progress — but hidden underneath are trading fees, tax drags, and the erosion of mental clarity.

🔗 Action Bias in Behavioral Finance

The Silent Costs

• Fees pile up. Even “cheap” brokers take their cut, and frequent trading magnifies the rake.
• Taxes bite harder. Short-term trades mean short-term tax treatment.
• Focus fractures. Chasing micro-swings distracts you from macro trends where real wealth compounds.

It’s death by a thousand cuts, but disguised as hard work.

How to Escape the Churn Trap

The antidote is counterintuitive: boredom discipline. Commit to rules that protect you from yourself:

1. Define your triggers. Only trade when X, Y, or Z conditions align. No exceptions.
2. Automate where possible. DCA (Dollar-Cost Averaging) into core holdings, then stop touching them.
3. Reframe inactivity. Not trading isn’t laziness. It’s restraint — the mark of a professional.

This is the same logic pilots use: autopilot doesn’t make them less skilled, it makes the flight safer.

🔗 Investopedia on Dollar-Cost Averaging

Key Takeaway

Churn Traps seduce you with the illusion of progress. But markets don’t reward activity; they reward results. Next time you feel the itch to click “buy” or “sell,” ask yourself: is this a strategy — or just the treadmill spinning again?

In the long run, wealth flows not to the noisiest traders, but to the ones who learn when to step off the machine.

Here’s the cruel joke of fear: by the time you feel it, the market already has.

Fear isn’t immediate — it lags. That’s why selloffs often feel like they accelerate the moment you finally panic-sell. The pros sold on the whispers. You sold on the headlines. That lag between signal and action is what I call FearLag.

🔗 Think back to March 2020: pros dumped risk in late February. Retail investors often waited until after the historic -10% days to hit “sell.” FearLag meant they exited at the worst possible moment — right before the rebound.

FearLag doesn’t just cost money. It erodes confidence. You start doubting yourself, promising never to “make that mistake again,” only to repeat it the next cycle.

Key Takeaway: The goal isn’t to eliminate fear — it’s to shorten the lag between recognition and response.

Humans love control. We grip the armrest during turbulence as if our fingers can stabilize 200 tons of metal at 30,000 feet. We push elevator buttons harder when we’re impatient, as if force will summon the cab faster. And in markets, we do the same — mistaking inputs for influence.

Traders overestimate their control constantly:

• Clicking refresh on charts every 30 seconds.
• Over-tweaking models as if one more parameter will unlock certainty.
• Believing a single hedge immunizes them from chaos.

But here’s the kicker: markets aren’t slot machines you can rig. They’re ecosystems. Complex, adaptive, and mostly outside your grip.

Psychologists call this the illusion of control — Ellen Langer’s classic experiments in the 1970s showed how people overvalued dice rolls when they threw them themselves. That same bias lives in traders who “feel” safer when holding the mouse, even if randomness dominates.

So what’s the antidote?
Not nihilism, not throwing up your hands. The solution is discipline:

• Focus on process over outcome. You can control your entries, your position sizes, your stop-losses.
• Accept that randomness dwarfs your personal willpower.
• Reframe: you’re a surfer, not Poseidon. You don’t command waves — you ride them.

That subtle shift matters. Markets humble those who cling to control, but they reward those who learn to let go while holding on to process.

🔗 For further reading, here’s a short primer on the illusion of control bias.

There’s a paradox in markets: the best trades often come not from white-knuckle effort, but from something closer to play. Psychologists call it flow — that state where your skills meet a challenge at just the right level, and time seems to disappear.

Think of an athlete “in the zone,” or a musician lost in improvisation. Traders get there too. Screens blur, not because you’re distracted, but because you’re absorbed. Every candle, every tick, feels part of a rhythm you can actually hear.

The trick? Flow doesn’t happen by accident. It requires:

1. Clear structure — defined rules, position sizing, stop-losses. Paradoxically, structure creates freedom.
2. Present focus — obsess less over “what if” scenarios. The future is always an Echo Trade 🔊🔁 waiting to distract you.
3. Balanced challenge — too easy and you’re bored, too hard and you’re stressed. The sweet spot is where your skills stretch but don’t snap.

Discipline, then, isn’t about being a robot. It’s about setting up the conditions where flow can happen — and trusting that the state will carry you farther than sheer willpower ever could.

Athletes know this: the clutch shot isn’t forced, it’s released. Artists know this: the masterpiece emerges when the brush dances, not when it grinds. Why should traders be any different?

If you want longevity in markets, stop treating trading like a grind and start treating it like a practice. Flow isn’t a luxury. It’s the only way to stay sane while compounding returns in an insane world.

🔗 Mihaly Csikszentmihalyi’s Flow remains the classic book on this state (overview here).
🔗 For trading parallels, Brett Steenbarger’s The Psychology of Trading (Amazon link) is essential.

When Carl Jung mapped the human psyche, he argued that beneath our individuality lurk universal archetypes — shared symbols and stories that shape how we see the world. The Hero, the Trickster, the Shadow.

Markets, strangely enough, have their own archetypes too. Think about it:

• The Eternal Bull — always charging, blind to cliffs.
• The Doom Prophet — forever crying collapse, secretly thrilled when proven right.
• The Trickster — the meme stock, the rug pull, the sudden volatility spike that turns every chart into slapstick comedy.
• The Shadow — the risks we hide from ourselves: correlations, hidden leverage, exposures that only emerge in crisis.

Why does this matter? Because investing isn’t just numbers — it’s theater. These archetypes are roles we play without realizing it. When you pile into a hot IPO, are you the Hero chasing glory? Or are you the Fool, rushing headlong into a Riskquake 🌍⚡?

History proves that archetypes repeat even more reliably than technical patterns. The 1630s tulip mania wasn’t just a bubble — it was the Hero myth, investors convinced they were chosen to ride flowers into fortune. The 2008 crash wasn’t just leverage — it was the Shadow finally stepping into the light.

Here’s the uncomfortable part: you’re in the play, whether you like it or not. Pretending you’re outside the script is the surest way to be blindsided. The real discipline comes not from avoiding archetypes, but from recognizing when you’ve been cast in one — and deciding if you’ll keep reading your lines.

🔗 Want a primer on Jung’s archetypes? The Simply Psychology overview is a great starting point.
🔗 For financial history’s greatest stage acts, Charles Mackay’s Extraordinary Popular Delusions and the Madness of Crowds (full text online) remains unmatched.

There’s a study in psychology that always cracks me up. Researchers put people in front of a slot machine with a fake “stop” button. The button wasn’t wired to anything — pure placebo. But players mashed it like their life depended on it, convinced it gave them control.

Markets are full of stop buttons that don’t actually stop the machine. We love levers, dashboards, and little tricks that make us feel in control:

• Stop-loss orders (great until liquidity evaporates and you get filled at prices you didn’t imagine).
• Over-hedging (layering puts and shorts until your portfolio is more like an overstuffed closet than a strategy).
• Dashboard obsession (watching 17 monitors doesn’t give you foresight; it just increases your odds of carpal tunnel).

The truth? Control in markets is always partial. You can steer position sizing, risk tolerance, and time horizon. But you can’t steer macro shocks, regulation shifts, or the butterfly wings of global liquidity.

The irony is, the most disciplined investors don’t seek total control. They build systems that accept chaos — portfolios resilient enough that a missed button press doesn’t wreck them.

So here’s your reminder: next time you reach for the illusionary wheel, ask yourself — am I steering the car, or the slot machine?

🔗 On the psychology of control illusions
🔗 Stop-loss orders and their pitfalls

One of the scariest things in trading isn’t the trade you make — it’s the trade you don’t realize you’ve made. Enter the Shadow Portfolio: the invisible set of exposures hiding inside your positions.

You think you’re diversified because you own Tesla, Apple, and a basket of tech ETFs. Guess what? That’s not diversification. That’s tech, tech, and… more tech. The correlations overlap, and suddenly your “balanced” portfolio is leaning on a single leg of the stool.

This isn’t just equities. Crypto has the same problem. You load up on DeFi coins, layer in ETH, and sprinkle in Solana for flavor. Looks diverse on the surface, but when regulation talks hit or liquidity dries up, they all move together. That’s a Shadow Portfolio revealing itself — usually at the worst possible moment.

The trick is learning to spot the shadows before they step into the light. A few ways:

• Correlation matrices — boring, but they reveal the hidden echoes between your assets.
• Stress testing — ask, “What happens if interest rates spike? Or if regulation suddenly bans staking?”
• Look past tickers — understand business models, revenue streams, and how they overlap.

👉 The irony is that most investors don’t get blindsided by things they’ve never heard of. They get blindsided by the shadows of things they already own.

Because the biggest risk in your portfolio isn’t what you see — it’s what you don’t.

🔗 Quick refresher on portfolio correlation
🔗 On crypto correlations with equities

The market has bulls, bears… and then there are parrots. 🦜
Not the Wall Street kind — the human kind. You know them: the guy at the dinner table who can’t get through dessert without repeating something he read on Bloomberg that afternoon. “Tech stocks are due for a correction.” Squawk. “Crypto halving cycle!” Squawk.

Meanwhile, the room quietly checks out. Because here’s the thing: nobody actually wants to sit next to a Bloomberg parrot. They want a person. Someone who can talk about books, or bad Netflix endings, or the Yankees’ bullpen collapse, without turning every anecdote into a chart.

I call it the Dinner Party Portfolio: diversify your conversational assets. If all you bring is markets, you’re overexposed. Talk about cooking, travel, movies, your weird uncle’s obsession with model trains. That way, when markets crash, you don’t crash the vibe with them.

Here’s the paradox: the more invisible you are socially as a trader, the sharper you tend to be in private. Why? Because you’re not burning your conviction out loud. You’re saving it for the trades that matter.

So next time someone leans in at brunch and says, “Got any stock tips?” — shrug, change the subject, pass the waffles. The less you talk, the more you see. And the more you see, the better you play the game.

🥞 Key takeaway: Nobody ever got invited back to brunch for reciting their P&L.

Every market story has a pull. Some are light tugs — headlines that shift a stock for a day. Others bend entire cycles around them. That’s Narrative Gravity: the unseen force that makes otherwise irrational moves feel inevitable.

But here’s the physics twist. In classical mechanics, you need escape velocity to break free from a planet’s gravity. Same with markets: to escape a dominant narrative, you need enough force — new data, new stories, or sheer momentum — to propel you beyond its pull.

Think of meme stocks in 2021. The data was terrible. Earnings weak, fundamentals absent. Yet the narrative — “retail against Wall Street” — had so much gravity that it bent analysts, news desks, and even regulators into its orbit. For months, you couldn’t fight it. Until reality (liquidity stress, options unwinding, broader corrections) supplied enough thrust to break free.

Or take Bitcoin. Its “digital gold” story has kept gravity for over a decade. Attempts to dismiss it as a bubble? Pulled back in. Environmental critiques? Pulled back in. But then ETFs arrive, adoption rises, and suddenly we’re talking about institutional scaffolding. That’s escape velocity in action — a narrative so reinforced by new infrastructure that it leaves old criticisms floating in the void.

🔗 Background: What is narrative economics? Robert Shiller’s work shows how stories spread like viruses — but physics gives us a sharper metaphor for when they collapse or ascend.

So here’s the investor’s move: don’t just ask what narrative is in play? Ask does it have escape velocity?

– Can the story survive contact with data?
– Does capital reinforce it, or contradict it?
– Has it infected enough participants that even skeptics must play along?

Because if the story has enough thrust, it won’t just bend the market. It will rewrite the map. 🚀