Financial Freedom Sloth

achieving financial freedom one lazy step at a time

I am a creature of two worlds

I was originally going to write a short post about the fact that I love outlet centers. Real outlet stores like D’store in Bierbeek which sells last year’s sports outfits at a very nice discount. I snagged the walking shoes below for 35 euro (50% off) and had I found a second pair in my size I would have gotten 75% off on that second pair! Shoes are a necessity of life and I love to get that at a low low price because it means I do not need a lot of money to provide for it for the rest of my life. If they last me 2 years of daily wear and I would need 2 different pairs to cover the different occasions in life, that would mean an annual financial burden of 40 euro a year x 25: 1000 euro stash and my feet are covered in early retirement!

So there I am, being all happy to have saved 35 euro on shoes. And then I come home and access my broker account and see my stash moving around a couple of 100 euro per minute. And it is strange.

Normally I ignore my stash. It’s there, I do not touch it and now and then I do a trade. But I am lazy so I do not do a lot of trades. Thus it is easy to ignore it. It is easy to ignore the day by day fluctuations if you do not see them. In my day to day life I am like anybody else. I have my -limited- resources and I try to cover my bills with it. It is in this day to day life that I am happy with a savings of 35 euro. Because in this life those savings matter. In my day to day life I am down to 900 euro in my accounts (we replaced our bathroom and kitchen a few months back and I just prepaid my holiday for September). And with a few renovations still necessary, I will need to continue to life within my – very narrow – limits for a few more years.

And then I access my broker account. 90% of my stash is in 1 stock: Berkshire Hathaway class B shares. For a grand total of 1500 of them. If that price moves by 1 USD, it makes a difference of 1.500 USD right there. But a movement of 1 USD  on a stock price of 166 USD. That’s a movement of 0.6%. It is going to move more than that! Actually, I have a leveraged position that makes movements even worse! My stash went up 30.000 USD in something like 2 months. Then it went down by 20.000 USD in one month. Hell, my leveraged position costs me 43 USD in interest EACH AND EVERY day (do not worry, the position earns around 90 USD per day also, so I am making a profit on it).

All this is easy to ignore when I do not see it. But as mentioned before, I am again doing a little bit of day trading again. Not only do I now see the stash (and it’s fluctuations) on a daily basis. The day trading actually makes matters even worse. Just today I have bought 100 CfD’s on Google 6 times and sold them (and made a small profit each and every time: yeah me!). I have bought and sold for 558.000 USD in Google stock!

So day to day life: 900 euro in the bank and really happy when I make a 35 euro savings on shoes.

My investment life: daily fluctuations of 1.000’s of euro’s in the stash, bought and sold more than half a million USD in Google stock in half a day!

Like I said, a creature of two worlds.

I have to say it is weird. But it must be weird for all mustaschians. I read blogs of people living on 50.000 a year but where the stash sometimes moves 100.000 USD in a month because their stash is over 2 million. It is this strange spa-gate between big stash and frugal living all of us will need to learn to handle. Ignoring the stash usually works. So time to get back to work where a 100 euro still equals a full day of work and not some small movement in the google stock price (even if I would love to be behind my screen when it crosses the 1.000 USD mark for the first time!).

4 Comments

  1. That is a great story indeed… in the expenses, ever € matters. With the stash, It can move way more…

    My secret: the stash is across multiple brokers and assets… Not possible to calculate moves that easy.
    And where I do my options, I almost have no stash assets… It keeps me calm and focused on other things

    • finan112_wp

      April 30, 2017 at 2:04 pm

      Having everything together does have it’s advantages also. Now everything can be used as collateral for leveraged positions which, if done correct, should boost my performance. It will be better once I no longer day trade as I can then ignore it again for most of the days …

  2. Certainly know the feeling! Daily expenses revolve around small amounts (most of the time, anyways). But the market fluctuation are certainly more significant, you’re bang on with this “creature of two worlds” post.

    • finan112_wp

      May 1, 2017 at 11:52 am

      I do sometimes have these little moments of great insight!! Alas, I also have these long stretches of time where I am a blabbering idiot …

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