Mr. Market Is Moody. I Stopped Answering His Calls.

A market that fell 34% in 33 days finished 2020 up 18.4%. If you sold in March, you locked in the loss and missed the year.

That one fact is the whole reason I stopped answering when the market calls. It took a 1949 book to teach me how.

The business partner who shows up every day

In The Intelligent Investor, Benjamin Graham describes Mr. Market. Picture a business partner who knocks on your door every single day and offers to buy your share of the company or sell you his. Some days he is cheerful and quotes a high price. Other days he is gloomy and quotes a price far below what the business is worth. His mood swings. The business does not.

Graham's point is simple. You are free to ignore him. You only trade with Mr. Market when his price is in your favor, and you never let his mood decide what your share is worth.

That book changed everything for me after I came back from Hawaii with $20 to my name, because it gave me a job description. My job was to own good businesses and stay out of the room when the quotes got loud.

What his mood swings look like in dollars

Take $100,000 in an S&P 500 index fund at the start of 2022. The index returned about negative 18.1% that year, so the account showed $81,900 by December. That is $18,100 gone on paper, and Mr. Market was screaming about it daily.

In 2023 the same index returned about 26.3%. That $81,900 became roughly $103,400. The person who held was ahead of where they started. The person who sold in December 2022 sat at $81,900 in cash, and had to be right twice to get back in.

2020 is sharper. The S&P 500 dropped about 34% from February 19 to March 23. A $100,000 account touched roughly $66,000. The index still closed that calendar year up 18.4% with dividends. Same business, same earnings power over the long run, wildly different quotes.

I held through 2018, 2020 and 2022. I did not do it by being brave. I did it by having a rule written down before the quotes arrived.

The rule I wrote down

My rule has three lines. I buy on payday. I own only S&P 500 index funds, the TSP C Fund and VOO or VFIAX. I never sell. Nothing in those lines depends on how I feel when the headlines turn red.

That matters because feelings are the one input I cannot control. Mr. Market is loud by design. A news anchor has 24 hours to fill, and fear holds an audience better than patience does.

My net worth went from nothing to about $750K in 8 years and is $781K now. I saved 50 to 60 percent of my income. The saving rate did most of the early work. Not selling did the rest, because a sell order in a drawdown is the single most expensive click an investor can make.

How a soldier puts this to work

You already live under rules that do not bend to your mood. You do not decide at 0500 whether PT feels good today. The standard is the standard. Treat your investing the same way.

Here is the version I give the soldiers I work with. I have helped 29 of them so far.

Automate the buy. Set your TSP contribution as a percentage of pay so the purchase happens before you see the money. A decision you never make cannot be a bad decision.

Pick one boring fund and write it down.The C Fund tracks the S&P 500. Put the rule in a note on your phone with today's date.

Limit how often you look.Checking a balance daily gives Mr. Market a daily vote. Quarterly is plenty.

Decide your sell conditions now.Mine is never. Yours might be needing the money for a planned purchase within five years. Either way, set it while you are calm.

Boring on purpose, relentless by design

None of this is exciting, and that is the point. The market will keep quoting prices, some of them ugly. Your edge is that you do not have to trade.

I am a battle buddy, not a financial guru. I do not know what the market does next year and neither does anyone on TV. I know what I do next payday: the same thing I did last payday.

Let Mr. Market talk. You are busy building.