Why do people like to set “SMART” goals on consequential activities they have little control or influence over?
For example, setting an investment goal of 8% return per year when you are a long only retail “investor”. Hmm…
When they hit their goals, they say its their stock picking skills (STI went up 20%).
But when they failed to hit their goals, they say it bad luck, its a bear market you know? (STI went down 20%)
Eh… Like that how is it any different from Passive Indexing?
Smart Passive Indexers don’t set goals on investment returns. What’s the point of setting goals on passivity? The whole point of Passive Indexing is you get Market returns. Period.
How to spot a long only retail investor who knows his stuff? (Notice I removed the ” “?)
They will never set absolute return goals like 8% a year. That is only possible if you are both a long and short investor (operating like a hedge fund). Wink.
They are wise and honest enough to admit they can only set a relative return goal.
You know, to outperform a benchmark by X%?
In a bear market, the best they can do is to have no losses (moving 100% into cash before the crash).
Already outperform like siao liao against their chosen benchmark!
Pray tell how to achieve that 8% goal of yours in a bear market if you can only long?
Of course, if you are iron-teethed (stubborn), you can still set your “SMART” absolute return goals with a long only investment strategy.
You add in tiny print after your goal setting:
This goal is valid only for bull markets. Its void for flat and bear markets for which I have neither the control nor influence over; I accept no responsibility whatsoever in such markets.
You now very de smart!
You ownself snake-oil ownself!
Singapore Man of Leisure (welcome to my blog; just google it!)