Investment Tips from the World’s Greatest Hockey Player
Wayne Gretzsky, who played for the NHL from 1979-99 is widely proclaimed as the greatest hockey player to ever play the game. As the story goes, a journalist once asked Gretzsky what made him so much better than the other players. He was only 19 at the time and was already considered an incredible talent. His response was ”the other players skate to where the puck is; I skate to where the puck is going to be.”
Beginning right now, if you were to read every great investment book ever written, none would give you greater and more eloquently simple and practical advice as that single statement from the hockey player who has come to be known as The Great One.
Americans spend an enormous amount of time and money trying to figure out exactly which investments to buy and precisely when to buy them. Here are the results: when investment or business circumstances and news are bad and investments lose value, investors sell their investments. Upon selling, they sit on the sidelines and watch and wait until prices rise (become high). When circumstances and news improve and investments go up in value, they buy and watch and wait until their investment values fall (become low). This is the classic “buy high, sell low” mantra shared by the miseducated masses. And, it is the polar opposite and complete misapplication of the Gretzsky philosphy ”skate to where the puck is going to be.”
If you continue to buy emotionally based on where the puck is or has been, how will you ever accumulate enough income and assets to live the life you’ve dreamed of when the time comes? This is a very serious question. The problem is that it’s tough to catch yourself buying emotionally. Why? Because it has become a habit. Habits, good ones and bad ones, are called habits because they are effortless and often invisible to us. And, of course successful investors, the beneficiaries of your misguided behavior, are more than happy to cash in on your blind spots and keep taking your money.
So, how do you know when you’re caught up in the emotional investment rat-race aka the loser’s game? You know when you go to your playbook and there is no playbook…no written Gameplan. The gameplan or playbook removes your need to to think about things and replaces the wiring that causes you to second-guess yourself. A gameplan makes decision-making automatic…that’s right, like a habit. There is no doubt about it. Far more investors lose far more money from indecision than from bad decisions. Again, The Great One put it best, You miss 100 percent of the shots you never take. In the absence of a gameplan you will sit out too many games and take far to few shots; and when you do play, you will make buying decisions on the impulse of greed and selling decisions on the impulse of fear.
Get yourself a Gameplan. Harvard, Yale, Notre Dame…all have investment gameplans that lay out the foundation for how they will invest their endowment capital to secure the viability of their respective institutions. Yet, the overwhelming majority of mis-educated investors continue to operate like wildebeast migrating across the great Serengeti. Having gotten so enamored with the frenzied crowd they are competing with, it matters more what everybody else is doing and where everybody else is going than whether the crocodile swimming nearby has had his fill of wildebeast this year. Separate yourself from the herd.
Our clients choose us because they sense instinctively that having a Gameplan gives them a greater possibility to win. No longer do they have to agonize over what to buy or sell, when to buy or sell, or if they should buy or sell. It’s already in the playbook. As the chief executive of a financial advisory firm, I know that the primary ingredient for a successful advisory firm is the same primary ingredient for any successful enterprise. And, this same ingredient is critical for you to have a financially successful household. That ingredient: the speed and quality of your decision-making. To ensure our clients’ success, we have a Playbook and we construct a Gameplan for each and every one. That gameplan keeps us clear about their direction and keeps them on purpose and on course. More importantly, it adds speed and removes road bumps to decision-making.
The media often celebrates Wayne Gretzsky as the greatest hockey player to have ever laced on a pair of skates. I agree with them. But in my office and from my viewpoint, The Great One is just as celebrated for the sage and eloquently simple insight he left – ”Skate to where the puck is going to be, and keep taking shots at the goal”.
