- By Jasvir Biriah
- January 13, 2018
- 6 mins
Why should investing be boring?
Boring investing is the best because it keeps things simple. Quality investing should be undertaken in a low-octane environment free from noise. It really is that simple, and the benefits just keep giving year after year.
I didn't always think this way. When I first started in the industry I bought into the high-octane lifestyle but it was simply exhausting and not conducive to making high-quality investment decisions. For this, you need a clear and peaceful mind. However, I did pick up the ability to work hard and process reams of information that would make most feel sick. As you can see, this isn't everyone's idea of excitement or excess in an industry that gives off a certain image.
In social gatherings, I tend not to talk finance because let's face it, financial services is a square subject and pretty boring to the regular person, and I'd agree, I'd much rather hear someone talk to me about their skydiving job or their experience as an elite soldier. Why on earth would anyone want to talk numbers? But I love what I do and the people I surround myself with commercially are equally as boring and that's just the way we like it. Funny enough, investing does keep me entertained not by the businesses, capital or the general buzz, it has more to do with lifelong learning, I do learn something new every day, and it's not a bore to turn up bright and early on a Monday morning. Some personalities are simply built for this, and I'm one of them
Avoiding the Wall Street Swagger
The best type of investing is not glamorous at all, there are no daily profits and there is no bragging about how smart you are clawing out some returns in one quarter. Quality investing is disciplined with tons of delayed gratification, and has zero Wall Street swagger. This investing style is built on patience, valuations, facts and statistics, it's akin to watching grass grow slowly and I don't blame investors for not wanting this life.
The reality is, if investing becomes too entertaining, and you enjoy the buzz of financial journalism with a plethora of opinions, you're probably not making any returns in the market. You're playing the game the market wants you to play. The most unassuming and modest investors tend to produce the biggest returns by sifting through 10k's and annual reports, whilst sticking to repeatable processes that they can implement time and time again.
What is your investment mentality?
It's all about perspective, let's make boring sexy. Why not? Let's make the inputs of every process fun. Investing is one big puzzle that can be figured out with some heavy lifting and some intellectual honesty and the excitement lies in the discovery. Investing isn't supposed to be easy, but this doesn't mean it has to be stressful or boring either. This is heavily linked to one's mentality, many give up on investing before they start to see the joys of compounding. But it takes a certain personality type to see it through for the next 50-odd years.
Final Thoughts
Life should be anything but boring, it's great to challenge the mind and find something new to accomplish. It can be mentally invigorating to embark on something new.
We bring this mentality to investing, it's a new journey every day and something worth accomplishing. By its very nature, you can see why longer-term investing can be boring. You are suppressing the most natural human traits in order to make evidence-based investment decisions without much emotional deviation. We ignore the fads and stick to systematic processes and facts, no matter what the market consensus is. The idea is to avoid making bad decisions over making that one great investment decision. This is why boring is best, it minimises fragility so longer-term compounding can do its work.
Author’s Disclaimer
The information contained in this post is for educational purposes only. All written content on this website are the opinions of the author. If shares or strategies are discussed, they should not be deemed as a recommendation to buy or sell any share, product or fund. We may have an interest in a strategy we discuss, and our advisory clients may be beneficiaries of our proprietary methodologies, investment tools and advice. Consult your advisor before making any buying or selling decisions in the public markets. Past performance provides no guarantee for future returns.
