Application for Price Alert Overload
Fourteen price alerts are active. Four are for assets no longer owned.
COUNTERFACTUAL ANALYSIS Subject: Price Alert Ecology, Q2 2022. Classification: Inflation Era, Post-Peak.
Premise
This analysis examines what would have happened if the subject had acted on the price alerts currently active on their phone. The analysis is counterfactual because no action was taken on any of the alerts in the relevant period. This is not a hypothetical: all fourteen alerts fired. None produced a trade.
The Alert Inventory
Current active alerts: fourteen.
Of the fourteen, three concern equity positions currently held. Six concern equity positions the subject intends to take but has not taken. Four concern assets the subject no longer holds, and for which the alerts have not been deactivated, because deactivating them would require opening the app and acknowledging the positions no longer exist, which is not a task the subject has scheduled.
One alert concerns a cryptocurrency that is now worth sixty-two percent less than the alert price. The alert was set as a "buy below" alert. The price passed through the alert and continued in the same direction. The alert fired once and is now irrelevant except as a memorial.
The Counterfactual
Counterfactual A: what if the subject had acted on the highest-conviction buy alert, which was set in January at a price the subject described to a colleague as "very attractive"?
The position would be down eleven percent as of the date of this analysis. This is not good. It is also not as bad as the seven positions the subject observed instead of entering.
Counterfactual B: what if the subject had not set any alerts and had simply not thought about any of this?
This scenario is not counterfactual. This is the actual behavior. The alerts fire. The subject reads the alert. The subject opens the brokerage app. The subject looks at the chart. The subject closes the app. The position is not taken.
Root Cause
The alert system is functioning correctly. The system is alerting the user that the price has reached the target. The user is not acting on the alert.
The alerts were set at prices that represented either a good entry or a good exit. Both have been missed. This is not because the alerts failed. It is because the decision to act, which was supposed to be pre-committed at alert-setting time, was not actually pre-committed. It was deferred to the moment of the alert, at which point the subject re-evaluated and decided to think about it more.
Consequences
First consequence: the subject now has a collection of alerts that represent historical price levels of emotional significance, forming an unintentional archive of what once seemed like a good price.
Second consequence: the inflation context of 2022 has made all the archived prices look different than they did when they were set. The analysis is technically correct and practically irrelevant to the question of what to do now.
Third consequence: two new alerts have been set this week. They will fire. The cycle will continue.
Absurd Rule
A price alert set during a moment of conviction fires at a moment of doubt. This is because conviction happens in the abstract and doubt happens when money is involved.
Contradiction
The subject has a clearly defined investment thesis. The thesis has not changed. The alerts reflect the thesis. The subject is not following the thesis. The thesis is fine.
Analysis complete. Position unchanged.