The market, like the Greek gods on Olympus, has a cruel streak.  It seems to enjoy toying with us mere mortals, and it seems to enjoy teaching us a little humility as well.

This time last year I threw my hat into the ring of InvestorPlace’s 10 Stocks for 2012 contest with my recommendation of Turkish telecom giant Turkcell (NYSE:$TKC). 

A monster run in the third quarter pushed me into first place, where I kept a tenuous lead up until New Year’s Eve.

As the final day of 2012 progressed, I had a comfortable 2% lead over the TheStreet.com’s Philip VanDoorn and his recommendation of Capital One Financial (NYSE:$COF)—a lead that I maintained throughout the day.  Up by more than a percent with less than an hour until close, I felt victory at hand.  I pulled a cigar out of the humidor, one I had been saving for a special occasion, and cut it.

So there I sat, cigar in mouth and torch in hand…waiting…when a funny thing happened.  In the closing minutes of the trading year, Capital One had a massive surge while my precious Turkcell flat lined.

I lost the contest by less than 1% in the final three minutes of the trading day. 

Needless to say, the cigar didn’t get smoked.  It got hurled at my computer screen in a volley of expletives I’m not particularly proud of.

Congratulations to Philip, by the way, on an excellent choice that would have earned his readers a handsome 38% return.

What lessons can we learn from my humbling tale?

To start, never get cocky when investing.  This is an endeavor that rewards a cool, composed disposition.  Your ego can be your worst enemy—particularly for male investors.

Yes, it’s fine to engage in frat-boy-like banter with fellow traders on StockTwits or Twitter (or better yet, over a beer after you leave the office).  I do it all the time, and it’s all in good fun.  Just make sure you keep a sense of humor about it, and accept that you will look like a fool now and then when you make your investment moves public.  It happens to us all.

Second, investing is a lot like horse shoes or hand grenades.  In the real world, being close is generally good enough.  Few investors who bought Turkcell at my recommended price would complain that it “only” returned 37% or that the Banco Santander (NYSE:$SAN), which came in third, “only” returned 26%.

And along those lines, it’s important to not get fixated on arbitrary timelines.  In the real world of investing, you don’t buy a stock and hold it for exactly one year, buying on January 2 and selling on December 31.  If an investment is working, you let it run.  And if it’s not, you reevaluate.  You either give the investment theme more time to work out, or you cut your losses and move on.

For example, Arcos Dorados (NYSE:$ARCO) had a terrible year, down 42%.  But Josh Brown, who recommended, did not stand by idly while it sank.   After the stock gapped lower on a bad earnings release, he sold the stock in the accounts he manages and lived to trade another day.  That’s what a good investor does.

And now, it starts again.  InvestorPlace just launched the 10 Stocks for 2013 iteration, and it should be a fantastic contest this year.  I cast my lot with German luxury automaker Daimler AG (OTC: $DDAIF), maker of the iconic Mercedes Benz.  But I also hold Jeff Reeves’ Intel (Nasdaq: $INTC) and Steve Freehill’s Two Harbors (NYSE:$TWO) both personally and in my Dividend Growth Portfolio at Covestor.  (Listen to Jeff and me discuss our picks in this podcast).

I encourage you to follow the contest.  And you buy Daimler—and it wins this year—we can light up victory cigars together on New Years Eve 2013.  The slightly-damaged stick that I cut on New Years Eve 2012 has been placed back in the humidor…for now.

Disclosures: Sizemore Capital is long DDAIF, INTC, SAN, TKC, and TWO.

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