Tuesday, 3 October 2017

Fool by "Percentage Ratio Scale" and limitation of our mindest.

In School, the first arithmetic that we learn is "+", "-", "x" and "/".

As we develop further, we start to learn "%". "%" would bias our thinking and limit our ability.


Here, I prove it.

1) "+" should go with "-".

If we lose $20, it is possible for us to make $20.


2) "x" should go with "/".

If we lose 5x "say our Rm 20 become Rm 4." We should be able to make back from "Rm 4 to Rm 20." This is because if we lose 5x, it is also logic, if we, make back 5x, under the "ceteris paribus" concept which is "everything equal under normal circumstances."


3) So, if we wanna think in "%" form. Then it should be "-%" and "+%". Say "-20%" and "+20%"

Say, if we lose "-50%" of RM 20. We have a balance of RM 10. Later, when we make back "+50%" from RM 10, we will have only RM 15...But, in reality, we still lose Rm 5. Isn't this a bad scenario.

Comments:

In conclusion, the percentage will always fool us and limit our thinking. Value our winning on an absolute ratio pair of "+"&"-" and "x"&"/" would be more rewarding and increase our world of possibilities.

In stock, if we can lose by 5x during a bear market. We can also win by 5x, giving rise to the possibilities of bagger stock during bulls.

"Fate favors those who are prepared"

Good Luck! Amigo!

Yours Sincerely,

Dr. Lion.  

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