Could meditation help deal with market distress?

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randomizer
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Could meditation help deal with market distress?

Post by randomizer » Wed Jan 24, 2018 9:33 pm

Mediation is often sold as a way of coping with stress, of learning to detach oneself from ones emotions (observe them, acknowledge them, then let them go). I'm wondering whether it might have some utility in a bear market to deal with the emotional distress caused by seeing half of your portfolio evaporate over a course of days, weeks, months.

I see a lot of over-confidence now that we're so deep into a long bull market, talk of "new normal" and all that. I don't think I'll panic and sell, but that might be hubris: I've never been truly tested. So I think it might be helpful to start meditating now to add a coping tool it to the tool-kit.

Was anybody meditating during the financial crisis? Did it help?
75:25

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Tycoon
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Re: Could meditation help deal with market distress?

Post by Tycoon » Wed Jan 24, 2018 9:37 pm

Meditation won't make the pain go away.
...I might be just beginning | I might be near the end. Enya | | C'est la vie

crit
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Re: Could meditation help deal with market distress?

Post by crit » Wed Jan 24, 2018 9:45 pm

Maybe. But if you need that much therapy .... maybe your risk tolerance isn't what you think it is.

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Phineas J. Whoopee
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Re: Could meditation help deal with market distress?

Post by Phineas J. Whoopee » Wed Jan 24, 2018 10:27 pm

I think yours is a good question, randomizer.

I can meditate. It doesn't change the world around me, but it can change how I respond to it. I can even meditate with my eyes open. I suppose that's probably a boast, except I'm too afraid of being physically attacked if my eyes are closed to meditate at all. Please don't ask how I can go to sleep. Each of us has our own weaknesses.

Mostly I think meditation attempts here in the US are often too much focused on end-gaining and not enough on means. This is only one example, but it's representative of many others: a former colleague (who later left - he didn't die just then) was hospitalized for heart disease. The <someones or otherses, I don't remember precisely who he said they were> told him to meditate. He said to me, later, he didn't really know how to do that, so <they> instructed him: clear your mind!

All he could think about, and it was entirely predictable, was whether his mind was clear or not, and if it wasn't, how to clear it. That's the opposite of clearing one's mind.

Don't think about an elephant!

What are you thinking about?

Meditation, among other techniques, is a process, not an end point, and is not amenable to emphatic commands. If one wants to pursue it, good. Great. But it isn't a matter of wow I'm worried about my investments so I'll meditate to stop feeling so stressed.

Anyhow, that's what I say. If anybody wants more practical advice about meditation please ask and I'll write what I can, but writing really doesn't capture it.

PJW

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randomizer
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Re: Could meditation help deal with market distress?

Post by randomizer » Wed Jan 24, 2018 10:33 pm

Tycoon wrote:
Wed Jan 24, 2018 9:37 pm
Meditation won't make the pain go away.
But could it make a behavioral mistake go away (be avoided, I mean)?
75:25

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whodidntante
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Re: Could meditation help deal with market distress?

Post by whodidntante » Wed Jan 24, 2018 10:34 pm

I've lived through the dot bomb and the financial crisis and didn't sell out of fear. I get far more nervous with these high US market valuations than I do during a bear market. I actually get excited about good buying opportunities. E.g., I was happily buying up EM after the Chinese stock market got cut in half. It seems to me that most of the money is made when you buy, not when you sell.

If you are still working, maybe try to view a bear market as a buying opportunity. ;)

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pezblanco
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Re: Could meditation help deal with market distress?

Post by pezblanco » Wed Jan 24, 2018 10:36 pm

randomizer wrote:
Wed Jan 24, 2018 10:33 pm
Tycoon wrote:
Wed Jan 24, 2018 9:37 pm
Meditation won't make the pain go away.
But could it make a behavioral mistake go away (be avoided, I mean)?
Yes.

GoldenFinch
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Re: Could meditation help deal with market distress?

Post by GoldenFinch » Wed Jan 24, 2018 10:39 pm

Trying to meditate makes me anxious so that wouldn’t work for me. I remember reading a long thread here on meditation a few months ago. A lot of Bogleheads were using it and found it helpful in general so it may work for them.

I really believe the best way to deal with any market worries is to stop paying attention to the markets completely! The problem is many Bogleheads really enjoy finance and can’t pull away from it all.

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Re: Could meditation help deal with market distress?

Post by azurekep » Wed Jan 24, 2018 10:48 pm

randomizer wrote:
Wed Jan 24, 2018 10:33 pm
Tycoon wrote:
Wed Jan 24, 2018 9:37 pm
Meditation won't make the pain go away.
But could it make a behavioral mistake go away (be avoided, I mean)?
I don't know much about meditation, but in the behavioral realm, "Anchoring" is a neat tool. Decide on an S&P-500 level that would scare you badly. Say 2300 (-19% from today's level). Once you have 2300 in your head, if the market only falls to 2600 (-8%), that doesn't seem like a lot by comparison. You actually feel good about the 8% drop because it was so little. You're thinking is anchored to the 2300 level.

I periodically use mind games like that, and it works well.

Small Law Survivor
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Re: Could meditation help deal with market distress?

Post by Small Law Survivor » Wed Jan 24, 2018 10:52 pm

Liquor is quicker ....

2comma
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Re: Could meditation help deal with market distress?

Post by 2comma » Wed Jan 24, 2018 10:55 pm

I'll drink to that! :sharebeer
If I am stupid I will pay.

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randomizer
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Re: Could meditation help deal with market distress?

Post by randomizer » Wed Jan 24, 2018 11:28 pm

azurekep wrote:
Wed Jan 24, 2018 10:48 pm
randomizer wrote:
Wed Jan 24, 2018 10:33 pm
Tycoon wrote:
Wed Jan 24, 2018 9:37 pm
Meditation won't make the pain go away.
But could it make a behavioral mistake go away (be avoided, I mean)?
I don't know much about meditation, but in the behavioral realm, "Anchoring" is a neat tool. Decide on an S&P-500 level that would scare you badly. Say 2300 (-19% from today's level). Once you have 2300 in your head, if the market only falls to 2600 (-8%), that doesn't seem like a lot by comparison. You actually feel good about the 8% drop because it was so little. You're thinking is anchored to the 2300 level.

I periodically use mind games like that, and it works well.
What happens if it hits 2200? Do you panic?
75:25

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Alexa9
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Re: Could meditation help deal with market distress?

Post by Alexa9 » Wed Jan 24, 2018 11:33 pm

Meditation is good if it works for you. Yoga, lifting weights, running sprints all relieve stress and yes moderate alcohol usage. But the best thing is to change how you look at a bear market with something like "cognitive behavioral therapy". You could see it as a rebalancing point or look at it as a sale on stocks. If you want to ride a wave, you've got to learn to surf. 8-)

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Phineas J. Whoopee
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Re: Could meditation help deal with market distress?

Post by Phineas J. Whoopee » Wed Jan 24, 2018 11:34 pm

Anchoring is a severe and harmful cognitive bias. I would not suggest adopting it as a deliberate psychological strategy to fake oneself out.
PJW

azurekep
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Re: Could meditation help deal with market distress?

Post by azurekep » Thu Jan 25, 2018 12:12 am

randomizer wrote:
Wed Jan 24, 2018 11:28 pm
azurekep wrote:
Wed Jan 24, 2018 10:48 pm
randomizer wrote:
Wed Jan 24, 2018 10:33 pm
Tycoon wrote:
Wed Jan 24, 2018 9:37 pm
Meditation won't make the pain go away.
But could it make a behavioral mistake go away (be avoided, I mean)?
I don't know much about meditation, but in the behavioral realm, "Anchoring" is a neat tool. Decide on an S&P-500 level that would scare you badly. Say 2300 (-19% from today's level). Once you have 2300 in your head, if the market only falls to 2600 (-8%), that doesn't seem like a lot by comparison. You actually feel good about the 8% drop because it was so little. You're thinking is anchored to the 2300 level.

I periodically use mind games like that, and it works well.
What happens if it hits 2200? Do you panic?
I'd be a very heavy buyer. :)

Anchoring is best if one already understands the emotional component of investing, and enjoys buying when the market is dropping. Still, even the most steeled investors can get a little spooked, so anchoring gives a little psychological boost.

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Re: Could meditation help deal with market distress?

Post by carolinaman » Thu Jan 25, 2018 7:52 am

randomizer wrote:
Wed Jan 24, 2018 9:33 pm
Mediation is often sold as a way of coping with stress, of learning to detach oneself from ones emotions (observe them, acknowledge them, then let them go). I'm wondering whether it might have some utility in a bear market to deal with the emotional distress caused by seeing half of your portfolio evaporate over a course of days, weeks, months.

I see a lot of over-confidence now that we're so deep into a long bull market, talk of "new normal" and all that. I don't think I'll panic and sell, but that might be hubris: I've never been truly tested. So I think it might be helpful to start meditating now to add a coping tool it to the tool-kit.

Was anybody meditating during the financial crisis? Did it help?
I think having an AA that your most comfortable with in good and bad markets is your best way to reduce stress. Also, understanding the history of market cycles helps and turning over the market noise from the media can reduce your stress.

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JPH
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Re: Could meditation help deal with market distress?

Post by JPH » Thu Jan 25, 2018 8:32 am

Meditation? Too passive. Do something more constructive. Review your IPS. Search Bogleheads for "Stay the Course." Go shopping for cheap stocks.
While the moments do summersaults into eternity | Cling to their coattails and beg them to stay - Townes Van Zandt

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Re: Could meditation help deal with market distress?

Post by jabberwockOG » Thu Jan 25, 2018 9:33 am

I meditate primarily on having 4-5 years of liquid interest earning non equity assets to use for living expenses in a market downturn .

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Re: Could meditation help deal with market distress?

Post by zuma » Thu Jan 25, 2018 11:50 am

Sure, meditation can help cultivate an understanding that most things in the world are not in your control. Learning to accept and internalize this can alleviate stress.

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Re: Could meditation help deal with market distress?

Post by kaudrey » Thu Jan 25, 2018 4:46 pm

Meditation doesn't work for everyone, and people do it for different reasons, but it could help.

I meditate every night. It helps me clear my mind and go to sleep (I have a tendency to lay awaking thinking). At first, my only goal was to fall asleep. After about a year of doing it, however, I find that I am calmer overall and less prone to letting things stress me out in general. It can change your mindset about life if you are open to it.

My SO does bikram yoga as his stress-relief, as another option... (I can't take the heat).

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Re: Could meditation help deal with market distress?

Post by Sandtrap » Thu Jan 25, 2018 5:27 pm

Adjusting allocation to a new, more conservative IPS works better than meditation.
Otherwise meditation is like trying hard not to thing of pink elephants while meditating. :shock:
j :D

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Re: Could meditation help deal with market distress?

Post by Toons » Thu Jan 25, 2018 5:30 pm

Once you truly realize that Bear Markets are Pure Opportunity,
You will find yourself smiling when markets decline.

:happy :happy :happy
"One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity" –Bruce Lee

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Re: Could meditation help deal with market distress?

Post by montanagirl » Thu Jan 25, 2018 5:44 pm

I prefer escapism. Just turn away to some hobby or art, or even work. Focus on something else. You need to shrug off the market and act fatalistic about it. Oh well!

That said, since I quit my music gigs I've had a much harder time with it. But I did manage to miss the 2015 slump somehow. :happy

(There was a slump, right?)

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Re: Could meditation help deal with market distress?

Post by Fallible » Thu Jan 25, 2018 8:03 pm

randomizer wrote:
Wed Jan 24, 2018 9:33 pm
Mediation is often sold as a way of coping with stress, of learning to detach oneself from ones emotions (observe them, acknowledge them, then let them go). I'm wondering whether it might have some utility in a bear market to deal with the emotional distress caused by seeing half of your portfolio evaporate over a course of days, weeks, months.

I see a lot of over-confidence now that we're so deep into a long bull market, talk of "new normal" and all that. I don't think I'll panic and sell, but that might be hubris: I've never been truly tested. So I think it might be helpful to start meditating now to add a coping tool it to the tool-kit.

Was anybody meditating during the financial crisis? Did it help?
I've never tried meditation and even if I had, I couldn't be certain it would help you deal with market distress. If you have reviewed your IPS and feel the amount of risk you are taking is still right for you (as one without experience in a bear market), and if you are not feeling anxious to the point of losing sleep and fearing you may sell in a downturn, then possibly meditation is worth trying. But first determine as best you can whether you are invested correctly for one without bear market experience.
Bogleheads® wiki | Investing Advice Inspired by Jack Bogle

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Re: Could meditation help deal with market distress?

Post by GoldenFinch » Thu Jan 25, 2018 8:26 pm

Toons wrote:
Thu Jan 25, 2018 5:30 pm
Once you truly realize that Bear Markets are Pure Opportunity,
You will find yourself smiling when markets decline.

:happy :happy :happy
I’ll just tune in to what Toons has to say during the next Bear Market. :D

DrGoogle2017
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Re: Could meditation help deal with market distress?

Post by DrGoogle2017 » Thu Jan 25, 2018 9:05 pm

If the market goes up you worry, if it goes down you also worry, make up your mind what's exactly is market distress to you. It doesn't sound like it to me.

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Re: Could meditation help deal with market distress?

Post by Toons » Fri Jan 26, 2018 5:27 am

GoldenFinch wrote:
Thu Jan 25, 2018 8:26 pm
Toons wrote:
Thu Jan 25, 2018 5:30 pm
Once you truly realize that Bear Markets are Pure Opportunity,
You will find yourself smiling when markets decline.

:happy :happy :happy
I’ll just tune in to what Toons has to say during the next Bear Market. :D
You are on the Right Track :happy
"One does not accumulate but eliminate. It is not daily increase but daily decrease. The height of cultivation always runs to simplicity" –Bruce Lee

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Re: Could meditation help deal with market distress?

Post by Finridge » Fri Jan 26, 2018 2:03 pm

randomizer wrote:
Wed Jan 24, 2018 9:33 pm
Mediation is often sold as a way of coping with stress, of learning to detach oneself from ones emotions (observe them, acknowledge them, then let them go). I'm wondering whether it might have some utility in a bear market to deal with the emotional distress caused by seeing half of your portfolio evaporate over a course of days, weeks, months.

I see a lot of over-confidence now that we're so deep into a long bull market, talk of "new normal" and all that. I don't think I'll panic and sell, but that might be hubris: I've never been truly tested. So I think it might be helpful to start meditating now to add a coping tool it to the tool-kit.

Was anybody meditating during the financial crisis? Did it help?
Try visualization. You don't need to sit in any position or go into a meditative trance for this...You can do this right now. Visualize that tomorrow the market crashes 50%. Visualize the news coverage, and the panicked reactions of friends, family and colleagues. Visualize your own reactions. Visualize your "new" portfolio numbers (assume all stock positions are down 50%) --and now (this is the HARD PART), visualize yourself *accepting it* and telling yourself, "It's OK, I knew this might happen. It's part of the ride." And then realize that this isn't just something you are accepting in the future, this is something that you are accepting (as a real possibility) RIGHT NOW.

If you CAN do this, that's good. If/when it happens, a lot of your friends will be panicking, and you will just be saying to yourself, "I knew this could happen. I was prepared for this."

If you find that you CANNOT do this, then you need to adjust the asset allocation of your portfolio to get it to the point where you can do this.

A "mindhack" that I use: When I look at my equity holdings and see the numbers I mentally tell myself that can only count on about 50% being there if I wanted it. As long as it's in stock, about half the value is ephemeral.

From everything I've heard, meditation is great. I have been meaning on trying it. But I think if you will "need" it (or things like it) to deal with stress in a market downturn, then in my opinion you should change your asset allocation.

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Re: Could meditation help deal with market distress?

Post by harmony » Fri Jan 26, 2018 6:22 pm

I heard a mental health therapist give a talk in which he discussed anxiety: It can take as little as 45 seconds for anxiety to build, but it takes 45 minutes for the body to come back to a normal state again. Any further attention to the stresser during those 45 minutes of unwinding starts those 45 minutes all over again. It is the most effective way for me to stay even-keeled. There was a suggestion of consuming alcohol and it won’t be thought of as medical advice. I hope this won’t be misconstrued. After my body is reacting normally again, I can face the problem more logically with a more constructive narrative and an appropriate plan of action.

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Re: Could meditation help deal with market distress?

Post by randomizer » Fri Jan 26, 2018 9:28 pm

Finridge wrote:
Fri Jan 26, 2018 2:03 pm
randomizer wrote:
Wed Jan 24, 2018 9:33 pm
Mediation is often sold as a way of coping with stress, of learning to detach oneself from ones emotions (observe them, acknowledge them, then let them go). I'm wondering whether it might have some utility in a bear market to deal with the emotional distress caused by seeing half of your portfolio evaporate over a course of days, weeks, months.

I see a lot of over-confidence now that we're so deep into a long bull market, talk of "new normal" and all that. I don't think I'll panic and sell, but that might be hubris: I've never been truly tested. So I think it might be helpful to start meditating now to add a coping tool it to the tool-kit.

Was anybody meditating during the financial crisis? Did it help?
Try visualization. You don't need to sit in any position or go into a meditative trance for this...You can do this right now. Visualize that tomorrow the market crashes 50%. Visualize the news coverage, and the panicked reactions of friends, family and colleagues. Visualize your own reactions. Visualize your "new" portfolio numbers (assume all stock positions are down 50%) --and now (this is the HARD PART), visualize yourself *accepting it* and telling yourself, "It's OK, I knew this might happen. It's part of the ride." And then realize that this isn't just something you are accepting in the future, this is something that you are accepting (as a real possibility) RIGHT NOW.

If you CAN do this, that's good. If/when it happens, a lot of your friends will be panicking, and you will just be saying to yourself, "I knew this could happen. I was prepared for this."

If you find that you CANNOT do this, then you need to adjust the asset allocation of your portfolio to get it to the point where you can do this.

A "mindhack" that I use: When I look at my equity holdings and see the numbers I mentally tell myself that can only count on about 50% being there if I wanted it. As long as it's in stock, about half the value is ephemeral.

From everything I've heard, meditation is great. I have been meaning on trying it. But I think if you will "need" it (or things like it) to deal with stress in a market downturn, then in my opinion you should change your asset allocation.
I guess the concern there is what happens if you pass this test visualizing a 50% drop and then we get a 75% drop? (In the 1920s and 30s stocks dropped 90%.) What happens if your portfolio stays low for 5 years? 10 years? 20? (Think Japan from 1990 to today.) The issue is with being tested in a way that you haven't anticipated, and I think for many of us that day will one day come, and maybe more than once...
75:25

azurekep
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Re: Could meditation help deal with market distress?

Post by azurekep » Fri Jan 26, 2018 10:42 pm

Finridge wrote:
Fri Jan 26, 2018 2:03 pm
Try visualization. You don't need to sit in any position or go into a meditative trance for this...You can do this right now. Visualize that tomorrow the market crashes 50%. Visualize the news coverage, and the panicked reactions of friends, family and colleagues. Visualize your own reactions.
You, know, this is one of those go-anywhere threads, so I might as well add some bizarre tips and techniques if only for the board's amusement. :P

1. The Fade. I 've been reading a series by Lawrence Block about a hitman named Keller. Keller is actually an unassuming, likeable guy and the books are written with no small amount of irony. Keller didn't like carrying out hits initially. He felt bad and the scenes haunted him. He then developed a system where he imagines the kill scene, he fades the colors in his mind, eventually turning the scene into black and white. Then he visualizes this black and white scene through the far end of a telescope, so it's getting smaller and smaller. By the time he's done that, the vivid image of the death scene has receded in his mind. The technique takes a bit of practice, but it works instantly for Keller now.

2. Down is Up. When you see a stock chart showing the market's plunging prices, turn the chart upside down. The faster and steeper the market falls, the higher the market will appear to rise.

3. Psychologist's Observations of a VIP. A number of psychologists and biographers have noted how some of a particular VIP's signature phrases -- often a part of a strategy -- may provide psychological comfort to the VIP during times of stress. I've adapted these techniques to the market:
  • Personalize the market plunge by creating an opponent. This will bring out your competitive nature and motivation to WIN. The opponent in this case is either Mr. or Mrs. Market and you're going to get your revenge by proving to him/her that you know how to invest successfully and emotionally handle temporary losses.
  • Dismiss the market plunge. The press may be flashing red hot headlines: "DOW DROPS 80,000 POINTS!!!". Your response is: "FAKE NEWS!"
  • Self pep talk- "I'm the strongest, smartest and most powerful investor the world has ever seen! I will weather this and come back stronger than ever!"
The irony is that this kind of stuff may actually bring a measure of psychological comfort by keeping up the fighting spirit. (You may lose a lot of friends though. :P )

Also the psychological comfort might stop working the minute you lay your head on the pillow at night.

While this was written in the spirit of fun, one should never underestimate the capacity of the human mind for self-deception, delusion, fantasies, etc.... especially when they're repeated so many times that you actually begin to believe them. If there's ever a prolonged market plunge where the market is nearing zero, maybe we'll all start to engage in this kind of stuff. :P

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Re: Could meditation help deal with market distress?

Post by Finridge » Sat Jan 27, 2018 1:29 am

randomizer wrote:
Fri Jan 26, 2018 9:28 pm
Finridge wrote:
Fri Jan 26, 2018 2:03 pm
randomizer wrote:
Wed Jan 24, 2018 9:33 pm
Mediation is often sold as a way of coping with stress, of learning to detach oneself from ones emotions (observe them, acknowledge them, then let them go). I'm wondering whether it might have some utility in a bear market to deal with the emotional distress caused by seeing half of your portfolio evaporate over a course of days, weeks, months.

I see a lot of over-confidence now that we're so deep into a long bull market, talk of "new normal" and all that. I don't think I'll panic and sell, but that might be hubris: I've never been truly tested. So I think it might be helpful to start meditating now to add a coping tool it to the tool-kit.

Was anybody meditating during the financial crisis? Did it help?
Try visualization. You don't need to sit in any position or go into a meditative trance for this...You can do this right now. Visualize that tomorrow the market crashes 50%. Visualize the news coverage, and the panicked reactions of friends, family and colleagues. Visualize your own reactions. Visualize your "new" portfolio numbers (assume all stock positions are down 50%) --and now (this is the HARD PART), visualize yourself *accepting it* and telling yourself, "It's OK, I knew this might happen. It's part of the ride." And then realize that this isn't just something you are accepting in the future, this is something that you are accepting (as a real possibility) RIGHT NOW.

If you CAN do this, that's good. If/when it happens, a lot of your friends will be panicking, and you will just be saying to yourself, "I knew this could happen. I was prepared for this."

If you find that you CANNOT do this, then you need to adjust the asset allocation of your portfolio to get it to the point where you can do this.

A "mindhack" that I use: When I look at my equity holdings and see the numbers I mentally tell myself that can only count on about 50% being there if I wanted it. As long as it's in stock, about half the value is ephemeral.

From everything I've heard, meditation is great. I have been meaning on trying it. But I think if you will "need" it (or things like it) to deal with stress in a market downturn, then in my opinion you should change your asset allocation.
I guess the concern there is what happens if you pass this test visualizing a 50% drop and then we get a 75% drop? (In the 1920s and 30s stocks dropped 90%.) What happens if your portfolio stays low for 5 years? 10 years? 20? (Think Japan from 1990 to today.) The issue is with being tested in a way that you haven't anticipated, and I think for many of us that day will one day come, and maybe more than once...

Randomizer, this is a good point. From my perspective though, it's more helpful to prepare for reasonably likely scenario. I expect that in the next 10 years, possibly earlier, we will see a 20%-50% drop. Yes, it might be a much greater drop. It could even go to zero (think global thermonuclear war). But if you want to focus on preparing for unlikely but possible "black swan" scenarios, then you might want to get out of the market entirely. Instead buy a survivalist retreat out in Idaho or somewhere and spend your money building an underground bunker and stocking it with supplies. Haha... If we end up facing that kind of scenario, I won't be prepared. And in that case I will have to revert to trying meditation or (even better!) some of azurekep's techniques. :sharebeer

Edit: Seriously... if it comes to this, I won't be meditating. I'll be scrambling to reduce expenses and increase income in any way I can.

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Re: Could meditation help deal with market distress?

Post by itstoomuch » Sat Jan 27, 2018 1:38 am

Sorta.
It put me to sleep when I thought about all the different ways that we survive the GR.
I never got past the 3 scenario.
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