Emotional frameworks

Tools for managing the psychology of money and market volatility

Key Insight: Your emotions are not your enemy—they're information. These frameworks help you process emotions productively rather than letting them drive impulsive decisions.

Managing Volatility Emotions

Fear (Markets Down)
Common triggers: Portfolio value dropping, Negative news cycles, Uncertainty about future

Response Framework

  • 1.Zoom out: Look at longer time horizons, not daily changes
  • 2.Check fundamentals: Has anything about your thesis changed?
  • 3.Avoid impulsive decisions: Wait 24 hours before major moves
  • 4.Focus on what you control: Your actions, not market direction

""Price is what I pay, value is what I get.""

Greed (Markets Up)
Common triggers: Fear of missing out (FOMO), Seeing others profit, Euphoric market conditions

Response Framework

  • 1.Remember your plan: Stick to your allocation strategy
  • 2.Beware of euphoria: The best time to buy is often when it feels worst
  • 3.Take profits strategically: Consider rebalancing
  • 4.Question the narrative: Is this time really different?

""Bulls make money, bears make money, pigs get slaughtered.""

Building Your Practice

Emotional resilience is built through practice, not perfection. Consider keeping a decision journal where you document:

  • •What you were feeling when you made a decision
  • •What framework you used (or wish you had used)
  • •What you learned from the outcome

Over time, you'll develop intuition and emotional discipline that serves you across all areas of life, not just finance.