Human mind has this unique ability to judge past events in the light of current affairs. And, this gives rise to phenomenal problems that torment us. This reaches infectious capacity more in certain aspects of human life than others. 

Investment being one of them. If you are an investor, an active one I mean – one that watches those squiggly lines crawl almost obsessively on the monitor – you would know what it is: It’s called the Hindsight Bias. It makes you go in circles and then more.  

For the last 3 days, I have been biting my fingers for not acting on AAPL when I watched it touch $85.66 on Friday, 10 October 2008. I knew, in my guts, that this is the lowest it will go, and is the best deal for the stock. And, I was this close to buying the stock on Thursday late night. But for some weird, unexplainable reason, I switched off the lights and called it a day. And next morning when I woke up, it was 10 AM Pacific Time, and most of the action as gone.  

I finally bought the stock at $104.77, paying almost $20 more per share. 

And now, my mind will not stop chattering. Today, I devised a way to dissuade it – I told my mind this: Imagine you were in Jurrasic Period, and you were one of the thumbnail (well, not exactly!!) sized mammals living in the burrows. What will be your most critical concern? Losing $20 per share on a stock, or getting squashed by a Brachiosaurus? 

And I wait for a response. None comes… The darn thing doesn’t even care to consider the situation!!! 

It simply wants to go back and make that $20 margin!!