Bear Markets Remind Us We’re Not Warren Buffet


Have you ever looked at your financial portfolio and felt like a god among men when every asset is in the deep green with huge gains?

When I started seriously investing during the pandemic of 2020, everything seemed so easy. Pick a stock you like or a trendy hot stock and watch it go goblin mode and get some good gains.

In a raging bull market, I saw myself as the invincible investor. I felt like Warren Buffet. [How bizarre that a young person thinks they know it all and can do it all, right?]

But the brutal bear market broke my prideful spirit. Like many others, my cynical cockiness met the cliff and fell to its [necessary] death.

With the rampant volatility in the free-falling market to the ever-increasing inflation problem, my outlook turned from sunshine and rainbows to deary skies.

And thus, I learned a valuable lesson: bear markets remind us that we’re not Warren Buffet. The silver lining here is that I got a real-life education. No need to spend thousands of dollars to get an MBA to learn that my portfolio is only as good as my discerning intelligence and, vice versa, as bad as my youthful ignorance.

Warren Buffet is the Michael Jordan or Tom Brady of investing. So, in the same way that we are not on par with Jordan when we shoot the ball and make a shot, we are not on the same level with Warren Buffet when we pick a stock, and it returns a sizeable gain.

It is, no doubt, tempting to believe you’ve got the X factor like Buffet when you’re in a bull market. But that is the illusion of investing.

I wasn’t on par with someone in the ranks of Warren Buffet because I was doing really well. I simply got in the market when everything was tumultuously down, and the quick financial recovery from 2020 through 2021 gave me a false sense of confidence.

It is only now — after eating a good ole slice of humble pie — that I realize investing is a lot harder than I thought. Nothing humbles the ego like seeing some of your holdings down 50% or 65%.

If given the opportunity to travel back in time, I would happily inform myself to not be so quick to foolish thinking and behavior when the going is good. Don't be so careless with hard-earned money. But alas, time travel does not exist — yet.

Ben Carlson rightly points out that bear markets are both normal and painful. If you’re in the market long enough, you will encounter the big bad bear, and it will not be pretty or pleasant.

Thus, a calculated attitude/mindset is the tool I most need in a bull or bear market. I now have a holistic understanding of my personal investing philosophy, plan, and patience to stick with it when times get rough and the markets turn red, and not get cocky when the portfolio is green.