I bet ya’ll have heard a common saying that every event, person, experience is a teacher. It comes into your life to either give you a good experience or a great lesson. A person can learn important skills like girth, strength, perseverance or even shamelessness from a petty stone. Or he can come out as a blank slate even after attending Elon Musk’s class on launching rockets. It depends on the student’s ability to see things differently, interpret situations creatively and his willingness to learn. On a similar note, I’ve encountered a few diverse life experiences which taught me a great deal that I’d like to share.
There are few unlucky people present on this planet who have trouble falling asleep and my friend is one of them. She can lay awake the entire night thinking random thoughts like what will she do when she gets a giant planet of her own, how westerners digest beer like its water, how can one use a tissue instead of water to clean and not feel disgusted or how is it that cricketers don’t take frequent bathroom breaks in ODI matches. The list is endless. To put an end to this nuisance, she, after a lot of deliberation, finally decided to go for psychotherapy. I looked up its definition to quench my curiosity as to what she was getting herself into. Turns out psychotherapy is the use of psychological methods, that are subjective to the person, to find out the solution to a problem. Therapy has a unique solution to all problems of life, it’s underrated given the stigma about all talk and no show, but it’s worth the trouble. All I interpreted was that she was gonna pay ₹1500 for 45 minutes of talking. I thought it was outrageous and a complete waste of money. But the world of psychology is bewildering, different and really exciting as one dwells into it. My friends had just started the same.
During the course of therapy, the psychotherapist gave her a few practices, affirmations, changes in thinking patterns and diets to follow and it started showing their results. She was able to fall asleep rather quickly. But the story does not end here because after some time into therapy she started falling back to older patterns and sleep again became a luxury. With the help of her therapist, she began working again on new and old techniques and was finally able to control sleep. When she shared her experiences about her journey, it blew my mind. She said that most people are not able to reap the fruits of therapy because they don’t have enough patience to stick around. Since we are humans, our brain makes mistakes and we fall back into familiar faulty patterns which looks like therapy isn’t working. But that does not mean that we stop it, the key is to stick around no matter how foolish it feels. With time the patient gets to know themselves better and can understand what their body needs. This is why in the end the one who had enough patience to stick around reaps the fruits.
Since my mind is always occupied by what I do, I thought hey! investing is similar to that! Investors are advised to not panic and run for the hills screaming if the market is up by a few points, down by a few (falling back to older patterns) or if they lost a little money while investing. It’s the cardinal rule! What is important is sticking around. As an investor, if you believe in the soundness of the underlying business (therapist), hold on to it. Because in the end, long term investors always maximize their CAGR no matter what (reap the fruits).
The more an investor sticks around the better he understands the market, researching an underlying business, his needs, his risk appetite, his goals thereby maximizing returns. It’s like being a seeker of your own truth.
Hence the life lesson here is to hold on; be it investing or doing something challenging. Because the fruits of patience are always worth the pain.
There are various other methods that an investor can try to win at investing like rebalancing, asset allocation, hiring a good advisor etc. Read more here – http://fivecapital.in/insights/f/the-hows-of-optimizing-your-cagr