It appears the Titan submersible saga has reached its grizzly end.
Reading headlines this morning, the US Coast Guard has apparently confirmed the vessel’s demise. An unfortunate end to a rather strange story…
To be honest, I hadn’t been following the developments that closely.
I was fairly bemused at the media’s infatuation with this whole ordeal.
But the more details that come out surrounding this company and its sub, the more bizarre things seemed. In hindsight, the number of red flags that have been raised by OceanGate is astounding.
For instance, because the company was technically operating in international waters, it had no need for official certification. OceanGate had apparently tried and failed to obtain this certification after an ex-employee exposed concerns about the subs’ design.
That all blew up in a lawsuit back in 2018, but it didn’t stop the company or its CEO.
Speaking of their CEO, Stockton Rush, he has been blasted for his comments on safety. Having dug up old interviews, the media has aired Rush’s dislike for regulation and protocols.
And then, of course, there is the whole $30 video game controller debacle. A fact that would almost be cartoonishly funny if it hadn’t resulted in the tragic loss of life.
My point is, from the outside looking in, this seemed like a bad idea from the get-go.
And yet, I see plenty of investors make the same mistake each and every day…,/p>
Never take risk for granted
Now, you may think it cold of me to compare financial losses to the loss of life on this doomed voyage. But that is actually relevant to the point I want to make…
Emotion, more than anything else, is what undoes us.
Our brains are too easily caught up in the euphoria or distress of our erratic emotions. That’s why we have market bubbles…because people get suckered into the phenomenon of the ‘fear of missing out’.
I don’t know what the passengers of OceanGate thought of their vessel or Stockton Rush before embarking, but I wouldn’t be surprised if they had a similar mentality. After all, if you’re spending a quarter of a million dollars on this trip, you’d expect most of that money is funding a safe journey.
At least, I would.
I could even see how one might be so caught up in the moment that they’re willing to overlook the more obvious red flags. Because, again, I’ve seen people do the same thing with their money, essentially investing in projects that are just as doomed to fail as OceanGate was.
That’s why you have to realise that when risk is involved, you’re at odds with parts of your own mind.
Only by relying on pure logic and rationality can you hope to overcome emotional decisions. The kind of decisions that can cost you a lot more than you ever hoped to lose.
And it is far easier said than done. The only reason I’m even in a position to talk about something like this is because I learnt from one of the best…
The rational risk-taker
Greg Canavan, our editorial director, has spent his entire career figuring out his own mind.
He, more than anyone else I’ve seen, understands the importance of being a rational investor.
In fact, he wrote an entire book about it!
If there is anything Greg does better than anyone else, it is rationality. He has spent years honing his craft — and this is why so many of his subscribers are so loyal.
Granted, as I mentioned yesterday, it also helps that in the past, he has tipped stocks that have delivered handsome returns. Because, even as an investor with their emotions under control, it doesn’t mean you can’t hit the jackpot.
If you know the risk and the reward, you can still walk away with attractive gains.
It is also the reason why I believe you should be excited about what Greg plans to share next…
He’s been working non-stop on his next big investment idea. In fact, I’d argue that it gets to the very heart of the risk versus reward debate for Aussie investors.
But it is not my idea to share.
You’ll have to wait to hear from Greg himself.
Until then, though, remember to keep your emotions in check as best you can.
It just might save you from your own perilous journey.
Regards,
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Ryan Clarkson-Ledward,
Editor, Money Morning
