Time Is Your Friend
There's this weird thing about time that I keep coming back to. In some contexts it's your worst enemy. In others it's the best thing you have going for you. The difference usually comes down to whether you're trading or investing. And I don't just mean with money.
Trading vs investing
When you open a trade, the clock starts ticking against you. You have fees, you have funding rates if you're leveraged, you have the spread you paid to enter. Every hour that position is open, something can go wrong. News drops. A whale dumps. Some protocol gets exploited on the other side of the world and suddenly correlations spike.
A trade has a fixed window. Maybe hours, maybe days. The shorter that window, the more your outcome looks like noise rather than signal. You're betting price moves your way before something random moves it against you. Every minute you're exposed is another minute where your thesis can get wrecked by something completely unrelated to your thesis.
On the other side, you buy an asset you believe in and just hold it. If the thing is genuinely good, it compounds. A protocol grows its user base. An ecosystem matures. New developers show up and build stuff. The longer you hold, the more time the underlying value has to catch up with (and exceed) whatever price you paid.
Look at SOL. It hit like $260 in late 2021. Then FTX happened. Dropped to $8. Eight dollars. If you were trading that with a short window, you got destroyed. But if you bought SOL at literally any point before 2021 and just held through all of it, you're up big. People who panic sold at $8 missed a 25x recovery.
BTC is the same story on a longer scale. Every single person who bought Bitcoin and held for 4+ years has been profitable. Every single one. Doesn't matter if you bought the top of 2017, the top of 2021, whatever. Zoom out far enough and it didn't matter.
The S&P 500 has positive returns in about 54% of daily windows. Almost a coin flip. Zoom out to any 20-year window in its history? Positive 100% of the time. Time turns a coin flip into a certainty.
Why this is hard
Everyone knows "buy and hold" works. The data is overwhelming. But people still trade. I still trade sometimes. Why?
Because waiting is boring. Seriously, that's most of it. Holding SOL for 5 years while it goes up 25x sounds amazing until you're living through the part where it drops from $260 to $8 and crypto Twitter is calling Solana dead. Your brain screams at you to do something. Cut the loss. Rotate into the thing that's pumping right now. Take action.
And trading gives you that feeling of action. Every trade is a decision, a read on the market, a little hit of "I figured something out." Even when you're losing money, you feel like you're doing something about it. Holding feels like doing nothing, even when doing nothing is the optimal strategy.
There's also the ego thing. Traders get to be right multiple times a day. Investors might only find out they were right years later. Guess which one is more addicting.
Beyond money
I think about this with other stuff too. Learning a skill, building a project, relationships. Same deal.
Short-term you can grind out a bunch of activity. Learn a framework in a weekend. Ship a feature in a hackathon. But the real compound effect comes from doing something consistently over a long period. The person who writes a little code every week for 3 years will destroy the person who does a 48-hour coding marathon once.
Same thing with fitness. Nobody got in shape from one intense gym session. But someone who walks 30 minutes a day for a year? Different person.
The annoying part is that the compounding isn't visible until way later. The first 6 months of anything feel like nothing is happening. You're putting in effort and getting basically zero observable results. Then somewhere around month 12 or 18 things start clicking and it feels like it happened overnight. It didn't. You just couldn't see the progress accumulating.
So what
I'm not saying never trade. Sometimes there are genuine short-term setups and it would be dumb to ignore them. But just be honest about what you're doing. If you're trading, you're accepting that time is working against you and betting your edge is big enough to overcome that. Most people's edge isn't.
If you're investing, your job is way simpler and way harder at the same time. Pick good things, buy them, and then survive the boredom and drawdowns without doing something stupid. Let time do the heavy lifting.
IMO the best financial decision most people can make isn't finding the next 100x. It's just starting earlier. Time is your friend, but only if you actually give it enough of itself to work with.