It's time for a moment of reflection.
I know many shareholders are hurting with their Z1P returns but it's really important on these situations to self-reflect because much more knowledge and experience is gained from reflecting on the losses than gains.
On this forum here are the most common reflections on why either you're underwater, or have seen your profits obliviated:
1. Shorters
2. CEO telling lies
3. Board sitting on their hands
4. Investment banks manipulating the share price to buy in low
All of these have one thing in common... they rid you (the investor) of any responsibility.
However, if any of the below applied to you, then perhaps there are some valuable lessons to take away from this experience:
1. Were you ever swayed by opinions of others in an internet forum? This may be subconscious e.g. valuing the opinion of holders and dismissing the opinions of non-holders. There is a huge amount of confirmation bias, one of the worst investor heuristics.
2. Did you fall victim to the anchoring bias? e.g. Z1P was $14 three months ago, so it's value is bound to be back there soon (ignoring the risk that that $14 was overpriced in the first place). Other anchoring biases I saw on here was the AFR article which mentioned something like $25 being the fair value, but this was based on a back of the envelope calculation and comparison with APT.
3. Greed. Did you ever decide not to take profits/diversify because you want to go all in and make big dollars? This one I'm still a victim off. I've sold most of my Z1P (tidy profit), sold SZL completely (barely broke even) also sold stack of my APT at a very nice profit but APT still makes up 40% of my portfolio. Something I'm acutely aware of and am looking at taking further profits in FY23.
I should note that I have fallen victim to all of these and a combination of learning about the psychology of investing (including all the cognitive fallacies that causes investors to make bad investment decisions) and also just learning from my mistakes have made me a much better investor.
As an experienced investor, and as someone who has been invested in BNPL since 2018 and also has a quantitative credit risk and finance background I consider myself a well rounded individual who can see through a lot of the bs on this forum (not unique to Z1P... this includes most of hotcopper). One thing that's always puzzled me is how much misinformation and deception is circulated on these forums. The scary thing is that it's the loudest people in the room, that often happen to be the biggest (in this case) Z1P fanatics that circulate this misinformation and this is gobbled up by posters that don't have the financial acumen to see the flaws. This goes back to point number (1) and being swayed by internet strangers (whether consciously or subconsciously).
This post isn't a post about how good or bad Z1P is, rather this is a post about taking the time to self-reflect on some of the investment decisions and taking responsibility for them.
Just as a bit of an educational tool, below are some of the worst investor heuristics that are almost always guaranteed to make you a bad investor if you're not aware of them:
1. Anchoring bias - The tendency to rely too heavily on one trait or piece of information when making decisions. e.g. Z1P was $14 so that is it's true value. Or Z1P bought Quadpay so forget everything else, it's a buy.
2. Availability bias - The tendency to overestimate the likelihood of events with greater "availability" in memory, which can be influenced by how recent the memories are or how unusual or emotionally charged they may be. E.g. Peter Gray visits the US - think about this long and hard enough and frequently discuss it on an internet forum and you'll have an expectation that big US announcement is imminent.
3. (The biiiig one) Confirmation bias - the tendency to search for, interpret, focus on and remember information in a way that confirms one's preconceptions. e.g. I think Z1P is a good investment, let's talk to people on Z1P forum about how good an investment it is, meanwhile let's make sure we don't take any notice of anyone with an adverse opinion. Also watching youtubers who are Z1P fanatics fits into this category too.
4. Disposition effect - The tendency to sell an asset that has accumulated in value and resist selling an asset that has declined in value. e.g. Anyone who won't sell a stock because it's in the red is guilty of this. What an experienced investor does is makes the best investment decisions irrespective of how much red (a tax benefit anyway) or green there is because often there is better ways to make that money back than just holding onto a declining stock. Me personally I have no issues in selling a stock in red.
5. Dunning-Gruger effect - The tendency for unskilled individuals to overstate their own ability and the tendency for experts to understate their ability. e.g. Pretty much any investor who picks stocks without having an understanding of stock valuations, portfolio allocations, balance sheets etc. This can be exacerbated following a bull run when it's pretty much impossible to be a bad investor, so people grow in confidence (often to their demise). I used Z1P in these examples to increase relatability but these biases happen with any stock. Sorry if this feels a little off topic but I think this is really valuable information and I can speak from personal experience I've become 10x the investor I used to be just by being aware of these biases and managing them (as best I can). The first step is to take responsibility for your investment decisions, be humble and learn from your mistakes.
All the best.
(20min delay)