Insight

Félix Orban's Portfolio Survived the Crash He Didn't Stay For

Mihaly·Sunday, September 20, 2026 Edition

THE STEPS BEFORE THE SELL

Open the brokerage account. Review the balance. Note that it is lower than last month. Note that it has been lower for three months. Open a tab with the fund's five-year chart. Close it. Open it again. Find the news explaining the drop. Read four articles confirming the drop is serious. Return to the account page. Move the cursor to "Sell."

Most investors lose not to bad assets but to themselves. The gap between a fund's reported return and what the average investor in that fund actually receives is well-documented and consistently wide — investors buy after gains and sell into losses, which means they hold the expensive shares and abandon the cheap ones. A lower return you can hold beats a higher one you abandon, because the return you abandon pays you nothing. The math of compounding is simple. What breaks it is the month the account is down and the news is loud and the cursor finds its way to "Sell."

“

A lower return you can hold beats a higher one you abandon, because the return you abandon pays you nothing.

”

Vanguard has tracked this for decades across its own fund data. In years of significant market decline, investor cash flows out of equity funds and into money market accounts — capital preserved in nominal terms, destroyed in real ones, locked out of the subsequent recovery. The investors who held plain index funds with unremarkable return profiles through 2008 and 2020 recovered. Many who chased higher-octane strategies and then exited did not, not because the strategy failed, but because they left before it could succeed.

LOOKING BACK AT THE POSITION

Say the drop already happened. Félix Orban is sitting with a portfolio that is down eighteen percent, looking at what he sold two months ago when it was down nine. The question now is not whether selling was rational then. It is what the review reveals about the portfolio he should build going forward. Not the most aggressive allocation he can tolerate in a good month. The one he can hold in a bad quarter without touching it. That is the real number. The ceiling is not set by expected return. It is set by how much red on a screen he can watch without moving the cursor.

Most people discover their actual risk tolerance after a loss, not before. The account statement is honest about this in a way the intake questionnaire never was. What it shows you is worth keeping.

🎯

Try This

Write down, in one sentence, the specific price drop that would make you want to sell your largest holding. Then write what you would do with the cash afterward — and whether that action has historically outperformed waiting.

How?

Key Facts

*A lower-returning portfolio you hold through a downturn will outperform a higher-returning one you exit in panic, because sequence of returns only matters if you stay in the sequence.

*The moment you feel the urge to sell is usually the moment selling is most expensive — volatility and emotional intensity peak together by design of how markets move.

*Before changing anything in your portfolio, write down what specifically you expect to happen next and what evidence would prove you wrong — this one step interrupts the panic reflex before it becomes a transaction.