Trust the racket (The Financial Athlete #122)

The discipline of an athlete is readily apparent by a lean and muscular physique. With long hours of weight training, aerobic activity, and proper diet, such a physique may be yours within only one year.

In contrast, the discipline of an investor is only apparent after many years have come to pass. His wealth has been accumulated incrementally.

The all too common impatient investor dismisses the disciplined approach because he craves wealth now. He has convinced himself that he possesses an uncanny ability to increase wealth exponentially, but in reality, he is out of control.

When my tennis instructor sees a student excessively move his body while swinging the racket, he advises, “Trust the racket. Keep the torso quiet.” This is nice way of pointing out that the student is out of control.

Sometimes, I hear my tennis instructor’s voice saying “trust the racket” in my head when I hit the volleyball on the beach with too much movement of my forearms (a bump). I also hear it when I become tempted to take on an outsized position in an investment with high risk. Metaphorically, the tennis racket is a reliable investment system. To “trust the racket” means to be disciplined to stay within its framework. The system must neither be too rigid nor too soft. It is flexible, yet governed by sound principles.

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