The Easiest Way to Win in Investing

Lou Holtz, famous for leading Notre Dame to a national championship, is also a renowned motivational speaker. He frequently concludes his speeches with some variation of, “Want to be happy for an hour? Eat a steak. Want to be happy for a day? Play golf. Want to be happy for a week? Go on a cruise. Want to be happy for a month? Buy a new car. Want to be happy for a year? Win the lottery. Want to be happy for a lifetime? Win a championship.”

The last sentence changes depending on the audience. “Make everyone you encounter feel better after the interaction” and “make sure people would miss you if you didn’t show up” are two variations I’ve heard, but that part doesn’t matter because this is an investing blog, and the first part is what I need to relate this to investing.

Want to be happy 54% of the time? Check your portfolio daily. *

Want to be happy 63% of the time? Check your portfolio monthly.*

Want to be happy 83% of the time? Check your portfolio every 5 years.*

Want to be happy 100% of the time? Check your portfolio every 15 years.*

Nuance matters in investing as much as almost any other field, and I don’t want to downplay this fact. It’s why there are 7.5 million Americans employed in finance, a number that has barely budged during the pandemic. But don’t we all have an overarching goal for our invested dollars — growth? The easiest way to see progress towards that goal is so embarrassingly simple — take a longer-term perspective. The unrelenting onslaught of perilous market “news” makes this easier said than done.

It reminds me of Jerry Seinfeld’s joke, “It’s amazing that the amount of news that happens in the world every day always just exactly fits the newspaper.”

You’ll never access CNBC.com to find a mostly blank page with the headline “No major news today. At least, nothing that should affect your investment strategy. Carry on.”

Most investing content is nothing but a distraction from your financial goals. Recent events have drawn comparisons between the stock market and a casino. These comparisons miss the crucial point that, unlike a casino, more time invested in the stock market increases your odds of winning. Unfortunately, like a casino, there’s no shortage of ringing bells and flashing lights designed to influence your behavior.

*Based on daily returns of the Russell 3000 index going back to 12/29/1978

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