“Yang Penting Cuan,” is a holy grail of closing statement from close-minded people that frequently appear in Indonesia investing forums.
Meaning “as long as I am profiting, should be fine.”
Anything. Anyway. Anyhow.
It doesn’t matter.
Because, at the end of the day, the benchmark of successful stock investing is the profit margin. Right?
Consider this scenario:
Suppose there’s a 19 year old brave man called Bravo who has managed to accumulate a wealth of 426 million standing by your side. The smell of a fortune you’d think. Aren’t you curious?
“How did he get his fortune at a such young age?”
Then Bravo told you that he was prepared to go, to add another 250 million into his pocket. Out of curiosity, you asked him, “Where can you find such opportunities at your age?”
“My 426 million? easy. Casino,” Bravo plainly answered. “I put my last 24 million before I earned the jackpot, which I know I am gonna get after all.”
You then throw smiles to the sky, “How many occasions until he lost all his 426 million to the last cent?” you mumbled.
Out of sight, Bravo actually never goes back to the Casino. He had a more important meeting with other 1 thousand young generations, hungry for knowledge on how to increase their wealth.
Bravo, out of his excitement, arranged a seminar on “How to gain 426 million in just a few weeks.”
“It’s not that hard. Just go to nearby casinos, play poker, and go all in whenever possible. The trick is to knock your card 2 times before peeking at the card you have. Then rub your left thumb to your right palm on the Turn–the 4th draw.” Bravo the Brave
Now that’s what we call Survivorship Bias.
More teenagers gonna break into nearby casinos to try to pull off the mind games developed by Bravo the Brave, thinking that the strategy will ultimately work.
Still “Yang Penting Cuan?”
As absurd as the stories of Bravo, there are plenty of people who experienced similar wealth growth. At some point, these “successful” people will show up to public, and tell the world about their inspiring story of making millions at a young age.
We will never hear about a guy named Bravo who lost his life savings in nearby casinos 2 blocks away. Worst, nobody would try to think about it from that perspective.
The thing that always comes to mind is the ease with which people accumulate wealth in unique ways. Without reconsidering the legitimacy of their method. Because, as you can see, some “succeeded” anyway.
You might think that’s impossible. No way teenagers, that already have awareness of psychology, behavioral finance, and digital society, fall into the “Get Rich Quick Scheme” that seems to be unrealistic like Bravo’s did.
Well, I’m gonna tell you that in 2021, there are an outstanding number of people capable of blatantly throwing away their pension funds, plus all their life savings into cryptocurrency that have no underlying value plus have an unlimited amount of supplies, and the upside potential is based on someone’s tweet on Twitter.
The Crypto coin has a cute logo of Shiba Inu though, and I am gonna say that it is a better investment thesis than waiting for someone to eventually pump the coin. By all means, it doesn’t sound more clever than Bravo’s scheme.
But who’s the first to tell that a dog themed Crypto coin up and down trend is based on someone’s tweet on Twitter?
It’s them. Who first testify that their strategy of “buy every coin he mentions on Twitter” is a new money-making strategy.
To escape the trap of survivorship bias, don’t pay attention only to what you can see. Consider other things that might happen along the same path. Try to comprehend the story behind their “success,” and try to exploit other possibilities.
Don’t get fooled by Survivorship Bias.