2/3/23 7:00 AM - Lesezeit

Investing With Courage and Discipline

Robert Karas

Chief Investment Officer, Partner

The suffering of war and wartime captivity can never be compared to the challenges of investing. However, lessons can and should be learned from heroic behavior. One man who still evokes astonishment and admiration for his attitude is Admiral James B. Stockdale, who died in 2005.

How did Stockdale even make it into management books? One reason was probably management expert Jim Collins, who spoke to him and incorporated it into his bestseller Good To Great. The 40-year-old fighter pilot and naval officer Commander James B. Stockdale, known as ‘Jim’, was shot down in North Vietnam on September 9, 1965. The Vietnam War was in full swing. After his parachute landing, Jim was sent to Hoa Lo Prison in Hanoi for 7 ½ years. The American prisoners later nicknamed it the Hanoi Hilton. He was tortured 20 times. Unimaginable! How does one endure? “I never doubted not only that I would get out,” Stockdale said, “but also that I would prevail in the end.”

Collins asked him, “Who didn't make it out?” Stockdale: 

“The optimists. Oh, they were the ones who said, ‘We’re going to be out by Christmas.’ And Christmas would come, and Christmas would go. Then they’d say, ‘We’re going to be out by Easter.’ And Easter would come, and Easter would go. And then Thanksgiving, and then it would be Christmas again. And they died of a broken heart. You must never confuse faith that you will prevail in the end – which you can never afford to lose – with the discipline to confront the most brutal facts of your current reality, whatever they might be.”

Principles for all areas of life

Jim Stockdale left us principles that can be helpful in many areas of life. Among them is investing. As an investor, you must never lose faith that highs will be reached again after a setback. Optimism is necessary for this. Nevertheless, we must face up to the often hard facts with which the markets confront us.

The past few weeks have raised hopes that the bear market of 2022 is already behind us. However, should it not be over by Easter, by the summer or even by next Christmas, we would still steer the portfolio through the storm with a steady hand.

Disclaimer: This is a marketing communication. Investments in financial instruments are exposed to market risks. Past performance does not predict future returns. Forecasts are not a reliable indicator of future performance. Tax treatment depends on each client's personal circumstances and may change in the future. Bank Gutmann AG hereby explicitly points out that this document is intended solely for personal use and for information only. Publishing, copying or transfer shall not be permitted without the consent of Bank Gutmann AG. The contents of this document have not been designed to meet the specific requirements of individual investors (desired return, tax situation, risk tolerance, etc.) but are of a general nature and reflect the current knowledge of the persons responsible for compiling the materials at the copy deadline. This document does not constitute an offer to buy or sell or a solicitation of an offer to buy or sell securities. 
The required data for disclosure in accordance with Section 25 Media Act is available on the following website: https://www.gutmann.at/en/imprint

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