The hit movie A River Runs Through It provided a boost to the fly fishing industry of the early ‘90s. The slow motion scenes of a young Brad Pitt elegantly casting amid the serenity of Montana’s Blackfoot River had the world yearning for what had to be the ultimate peace of mind experience.
So, this Labor Day, yours truly found himself wedged between the towering cliffs of California’s breathtaking Kings Canyon. An area John Muir found to be as beautiful as the world-renowned Yosemite National Park. An appropriately edited slow motion video of me casting into the crystal clear pools of the upper Kings River would’ve easily rivaled the scenes from that 1992 movie (save of course for the young Brad Pitt part). Operative words being “appropriately edited”, for the scene of me cursing aloud as I stepped off the edge of a boulder and into a 4+ feet deep pool, filling up the left side of my waders, would no doubt kill the mood otherwise provoked by my would be documentary. The multiple times when my fly caught the errant branch protruding from a tree or bush behind me, and the many tangles that plague a merely average fly fisherman like myself --- along with the attendant cursing --- would need deleting as well. Yeah, sheer heaven!
Ah, lessons… Upon collecting myself after the plunge off the boulder it occurred to me that I was in the process of completely losing sight of what I was up to that afternoon. Fly fishing, in its essence, is about rhythm; the rhythm of the cast, the flow of the stream, the rhythmic feeding habits of wild trout. Was I, I thought to myself, to allow the falling into the water and the multiple snags and tangles to cause me to lose my internal rhythm as I cast, as I study the river’s flow and as I survey the surrounding insect life? A deep breath – a calmness invoked by my internal query – and I resolve to peacefully proceed upriver, casting with a smooth rhythm into the pools that experience suggests give me the best odds of catching the wily native trout.
Yeah, I know, this is supposed to be an investor’s blog. So let me tell you a golf story:
Had to be five years ago, I’m golfing Belmont Country Club with dear family friend Dan Douglas. Dan’s a low single-digit handicapper – it’d be like young novice angler Brad Pitt (well, again, not in every way) on the Blackfoot River fishing alongside a skilled fly casting instructor. So Dan and I are at the number 10 tee box. We let loose our drives, we then motor the cart toward the first ball we see --- actually, the only ball we can really see (there is another white speck on the fairway about a hundred yards further) --- neither of us, alas, wondered in the least whose was the first ball we approached.
With two-hundred and a lot yards to the green I approach my ball with three-wood in hand. After about my nineteenth practice swing, Dan, interrupting my
tense focus, says “take a deep breath and let your shoulders slump”. I shrug my
shoulders and say “huh?”. “Completely relax, let your shoulders fall and get
really loose.” Well, who was I to question the man with a 20-stroke lead after
nine holes? I back away from the ball, take that breath, release my shoulders,
make my approach, and proceed to swing gently through and watch in awe as the
tiny sphere rises into the air, reaches its crescendo and descends on a perfect
line toward the front edge of the green. My number 1 Titleist (actually, it was
Dan’s; I ran out of balls while teeing off on hole number four) struck the
green, bounced a time or three, rolled a bit, and came to rest maybe five feet
from the cup --- I was dumbstruck! A slump-shouldered putt sealed me a birdie.
I’d love to say that the remaining holes delivered nothing but birdies and pars, but I know my readership includes a good number of golfers and, well, if it were only that easy. Truthfully, the rest of the round was indeed way better than the front nine --- which ain’t sayin much.
Yes! This is supposed to be an investor’s blog! So let me tell you a basketball story:
Just kidding :)
Ah, lessons…The conditions that determine the results of a fishing outing (time of day, temperature, the lunar cycle, feeding patterns, shadows, other fisherpeople, wind, etc.) and a round of golf (the quality of our sleep, what we drank the night before, what we had for breakfast the morning of, our mood, the tempo of the fivesome in front of us, wind, moisture, muscles, etc.), are manifold, but I suspect one could compose a list of the major variables that weigh on one’s odds of success at either endeavor. As for “playing” the stock market, however, there’ll be no such composing. For the thousands upon thousands of investors acting upon their unique thoughts and emotions with regard to uncountable and ever-changing environmental influences make any attempt at assessing what will impact the market at any given moment a fool’s errand.
So does the knowing of the factors that would impact a fishing outing or a round of golf guarantee us success in either instance? Of course not, many of those factors are beyond our influence, let alone our control. So is there anything that we can influence that might improve our odds? Absolutely there is! You might call it the process, or the discipline; the manner, that is, in which we approach the stream or the tee. Or you may prefer to think of it as rhythm: the bringing together of the things we’ve learned and the things we know intuitively, and acting smoothly and consistently on those knowings – even when the elements conspire to yield us the periodic, and inevitable, less than desirable result. In essence, we know that every trip to the river, and every round of golf, will certainly not deliver “success”, by society’s standards, yet we know that if we remain consistent, perhaps tweak a little something every now and again, if we remain relaxed and in the flow, our overall odds of success – be it per outing or in the aggregate over a number of years – increase exponentially.
As for investing, yes, unlike perhaps golf and fishing, the factors in play are, again, too numerous to count, let alone assemble and predict. Ah, but what truly matters in the broader scheme of things is virtually the same. Whether we call it rhythm or discipline, being consistent in our approach and staying true to the principles (diversification, maintaining equity exposure consistent with our temperament, periodic rebalancing, sticking with the trend, never timing the market, etc.) that allow us to remain invested through turbulent times indeed increases our odds of long-term success as well.