Good morning & happy Monday!
Human action can be modified to some extent, but human nature cannot be changed.
Abraham Lincoln
Someone recently shared with me a YouTube video of a hiker in Utah who encountered a cougar while hiking alone. The cougar stalked the guy for 6 minutes and multiple times lunged at him.
Here’s a link to the video (warning: lots of profanity that is bleeped out):
Cougar Follows Me for 6 Minutes (rumble.com)
The 15 seconds from 2:45-3:00 are particularly intense.
This hiker did everything almost perfectly. Stand tall. Make eye contact. Talk loudly. Appear as large as possible. Walk away slowly facing the animal.
Now … what would human instinct be in such a situation?
I don’t know about you, but my instincts would be to run as fast as I possibly could!!! But, that would probably get me killed in such a situation.
Several years ago, I was hiking alone in Alaska in grizzly bear country. As I started the hike there was a list of things to do, and not do, if I were to encounter a bear. I read that list, re-read it, and then re-read it again. I had to coach myself over and over again on what steps to take in the event I ran into a bear, because the actions I would need to take would be contradictory to the actions I would naturally want to take (run). Fortunately, I did not have a bear encounter on that hike, but my prayer life was very strong that day 😊
Now, what does all of this have to do with investing?
Well, our human instincts when we see the value of our investments go down is to sell … to stop the bleeding … to go to cash for a while … for Pete’s sake, do something. But such actions can be exceptionally detrimental, maybe even catastrophic, to our financial success.
My friends, one of the main purposes of these weekly emails is to remind all of us the “instructions” regarding investing. Instructions like:
- Don’t lose sight of your goals
- Don’t make emotionally based decisions
- Don’t consume too much financial news media (which exists to scare you)
- Don’t freak out when your investments go down from time to time
- Do be patient
- Do stick to the plan
- Do reach out to me if you need to discuss
Human nature is what it is. But, I believe that with proper planning, coaching, and preparation we can all survive such temporary financial storms.
To use a baseball analogy: investing is not about hitting home runs, it’s about not striking out. Times like this it is easy is strike out. That is what I am here for, to do the best job I know how to coach my clients to not strike out.
Thank you for the tremendous privilege of being a coach on your team!