After knowing that you have done your homework just have faith and patience in your investment
What does tracking tigers in one of India’s top tiger reserves have to do with the principles of investing? How are they even remotely similar?
Last month, I found myself in the middle of the Indian jungles in a lovely tiger sanctuary called Tadoba in Maharashtra about two hours from Nagpur.
With WFA (Work From Anywhere), I chose the Bamboo Forest in Tadoba because they promised me the highest speed internet in my room – work and safari in one place – no guilt with all the fun! My ten days were going to allow me 18 trips to the forest, so I was very sure I would see some big cats. four rides later and with zero cat sightings, my frustration mounted and I could feel my anxiety – I had paid so much money, where are the cats? It must be the guide, it must be my driver, no, no it must be terrible Tadoba. They advertised it all wrong. My feelings of entitlement increased – here I am, Trustee of the Wildlife Conservation Trust, India’s leading private conservation NGO (www.wildlifeconservationtrust.com) spending my time and money to save these buggers and they don’t want to show their faces to me and are entertaining others instead? My conscience meanwhile kept telling me – nothing is guaranteed in the forest. These are animals, no one can predict their moves. Enjoy the journey and have faith that you will see something spectacular. So, I go on rides 5,6,7, and 8..NOTHING! At this time I was tempted to give up on Tadoba and take the next flight to Jaipur to the ever favourite Ranthambhore National Park (3 hrs from Jaipur) and satisfy myself. At least there I would be able to see something. But luckily logic prevailed, there were no guarantees in Ranthambhore either and I knew that so many “dry” days are rare in Tadoba and something WILL come up.
I thought through all the positives related to Tadoba National Park and reasoned with logic as opposed to emotion.
1) It has one of the highest density of tigers of any Indian National Park
2) I had very experienced drivers and guides 3) Others were seeing lots of cats, including the elusive black panther
4) I have had wonderful prior experiences in Tadoba
5) It is one of the best-managed parks in the country so there is no chance that the tiger numbers are lower than projected
6) In my experience, patience pays
7) In my belief, perseverance and faith always pay.
8) I had enjoyed the service and the beauty of the forest after all, even if I had not seen a big cat
It was a tug of war between my impatience and logic.
Eventually, and thankfully logic won. On ride #9, my luck changed - I saw my first tiger of the trip – a small cub crossing the road and his mother at a distance amongst many other eager cars (not happy with the congestion, but at least the jinx was broken!) After that, a leopard at a very close distance (very rare) and eventually a mother tiger with cubs on a fresh kill and finally the mother and cubs walking with us on a road with no other cars – they did a “catwalk” exclusively for us – a roadshow and we had them to ourselves for 30 mins and then bumped into a leopard for another 50 mins, another private showing! When it rains, it pours.
All the other nine rides were successful in spotting big cats! I came back to Mumbai very happy and satisfied knowing that my time was well spent and my money was well invested into a jungle escape that brought me much joy.
All the while, I was drawing parallels to investing. How frustrated do we get and how entitled do we feel when the funds we choose or are recommended (by our trusted advisors) don’t perform and we get tempted to move to other funds only to find out that the funds we jumped from are now roaring and the funds we moved to (because they had been giving good returns) are now underperforming.
We blame all others – the financial advisor (equal to the forest guide), the fund house (equal to the hotel and its driver), the fund manager, and mutual funds as a category in all (equal to Indian National Parks). We never attribute it to perhaps the time we chose to invest (perhaps we had recency bias and we invested in the fund at its peak), our folly to invest too much in one category and not diversify, or just our bad luck!
We lose patience, keep jumping from fund to fund and mutual funds to direct stocks only to be disappointed after a while (Thank God I didn’t jump on that flight to Jaipur only to miss all the excitement in Tadoba).
The jungle teaches you to be patient as does the stock market and investing in general. Using logic over emotion tends to be very difficult for the very best of us (I am guilty of this too). Just like I tried to reason with Tadoba, it’s important to reason with your investments: does the fund manager have a good long-term track record? Does the fund manager have a well-documented and articulated investment process that is monitored?
Have I read it and do I agree with it? Does the fund house have a good track record? Do equity funds eventually do well in the long term? Did I enter at a time when the fund was at its peak? Did I go in with high immediate expectations when knowing that equity investments can be volatile and will serve me well in the long run? Did I know that being patient is part of the game?
I can’t help but think that my many years of jungle visits have certainly taught me to be patient and train my mind to side with logic over emotion. Do I still falter? Of course, I do. We are after all human. But it is important to keep introspecting, not blaming all those around you, keeping centered and reflecting and weighing logic over your emotions. After knowing that you have done your homework (or having had someone trusted to do it for you) just have faith and patience.
The author is Director and Head Sales and Marketing at DSP investment Managers
DISCLAIMER: Views expressed are the author's own. Outlook Money does not necessarily subscribe to them. Outlook Money shall not be responsible for any damage caused to any person/organisation directly or indirectly.