How to overcome FOMO – Smart Fone Video Blog

FOMO is a very common phenomenon, and everyone without exception experiences it from time to time. Investors and traders are especially susceptible to it, since the market situation changes daily, and even more often when it comes to cryptocurrency.

What it is

The term FOMO (Fear Of Missing Out) is an emotional reaction to the loss of a potential chance to earn money or other benefits. This reaction varies, from mild regret to deep apathy or, conversely, unbridled rage.

It is physically impossible to monitor social networks around the clock, respond to every industry news and control your investment portfolio. And during the day there are many other things to do. Well, it’s really annoying when you open the terminal and find that in the previous two hours the XRP has increased by 20% and has fallen back to its original level. thoughts like: if I had exchange TetherUS to Bitcoin eight years ago and recorded a profit in 2021, then”…

Such thoughts spoil your mood, knock you out of alignment, and provoke spontaneous emotional actions. As a result, lost potential profit turns into very real losses.

The main reasons for FOMO are:

– Popularity of the asset. It is quite difficult to resist the temptation to buy an asset on the wave of hype and get rich quickly. Stories like the transformation of $200 into $2 million due to a jump in the price of the PEPE memcoin add fuel to the fire.
– Social influence. The feeling of missed opportunity is heightened by the fact that someone else got what could have been yours.

Consequences of FOMO

We have already mentioned the “sweet couple” of impulsive decisions and losses. Yes, there are exceptions, but profit as a result of an impulsive decision is very rare. But these guys have another friend – excessive concentration on a popular asset.

Suffice it to recall the achievement of Bitcoin’s historical maximum, when its exchange rate almost came close to $70,000 per coin. History is silent about the number of investors who tried to jump on the departing train in the hope that prices would continue to rise.

But it turned out that the train was leaving in a different direction. In two months, BTS fell in price to $35,000, and in the summer of 2023, the scenario with a possible drop to $12,000 looked quite realistic. No matter how strong the temptation, neglecting diversification and investing everything in a “hot” asset is too risky.

What to do about it?

It is not possible to completely avoid FOMO in investing, but it is quite possible to reduce its manifestations and consequences to an acceptable minimum. Yes, you will have to muster your will and make an effort, but it is really worth it.

– Set financial goals. Determine your time frame, budget, and your maximum risk tolerance.
– Analyze and learn. Study the principles of investing, learn to analyze different assets, and refrain from impulsive decisions. It might be a good idea to work with a professional financial advisor.
– Diversify. The golden rule of an investor is to distribute capital between different assets in order to reduce risks.
– Don’t get caught up in the market noise. If you decide to invest, it should be based on long-term prospects and fundamental analysis.

What psychologists advise

– Switch things up. At the moment when a storm of emotions covers you, switch from them to your external state. To the point, list what you feel from the outside, what you see and hear. Return to your inner experiences without trying to suppress them. Switch your attention to the outside world again and do this several times.
– Introduce your inner critic if it bothers you. Try to introduce him as a stranger and respond to his accusations.
– Work on your own endurance.
– Think about those who are lucky this time. If they are in the market, then they also once experienced and will experience the same thing more than once. Everything flows, everything changes, and someday someone will envy you the same way.
– Compare yourself with yourself yesterday. You also had your own achievements, didn’t you? You recently successfully convert USDT to EUR or bought on ETH at a local minimum. Focus on your achievements. If you had them, then you will continue to have them.

The market is like a huge organism. If the average earthling is not particularly aware of the processes in his own body, then what can we say about attempts to predict events in a huge third-party system. Keep calm and act according to your plans.

** (Disclaimer: This video content is intended for educational and informational purposes only) **

By smartphonejunkie