Zen- Vesting: The Road to Graham-and-Doddsville (5)

 

"A great traveler was complaining that he was never better off for his travels. "That is very true," said Socrates, "because you travelled with yourself." Now, had he not better have made himself another man than to transport himself to another place?"

There are many proprieties of vice when it comes to stock market investing. One of such are exaggerated expectations and uncertain hopes when venturing into the business of stock market investing. Because the investor with elevated expectations is perpetually anxious and in suspense. And when he has taken great pains in investing to no purpose, he starts to regret his undertaking. He becomes afraid to go on, because he is unable neither to master his expectations nor obey them. He lives, and likely will die, restless and irresolute.

Elevated expectations are the reason that puts most investors upon rambling voyages when it comes to investing. The buy and hold strategy please those investors today, and trading tomorrow. The splendors of growth investing attract them at one time, and the prudence of “Value Investing” another. And all this while they are carrying the plague about themselves.

Those investors have to learn that it must be the change of mind, not of the stock he is investing or strategy he is pursuing, which will remove his inquietude. That his voice goes along with him, whatever stock he is holding or strategy following.

The successful “Value Investor” must keep on its course, independently of market volatility and the opinions of fellow investors. Only then will he get to the journey's end of satisfactory long- term results. The investor that cannot live happily with one strategy will live happily with no strategy.

The frequent changing of strategies and heavy trading in stock shows instability of mind and overconfidence. Those investors interact with Mr. Market just like children run up and down after strange sights. They do so for novelty and not for profit. And they will return from their venture neither better nor sounder.

Quite the opposite! The agitation only hurts them and their clients. They learn to call ticker symbols, name companies and executives, and to tell stories about them. But would their time not have been better spent in studying the simple framework of “Value Investing” outlined by Graham and Dodd, and then the virtues needed to pursue such a strategy, i.e. knowing oneself?



Reference:

Frances and Henry Hazlitt; The Wisdom of the Stoics; University Press of America 1984