There Is Always Someone Else To Blame

It starts in childhood: my sister took my book away. It's her fault that I'm angry now. My brother didn't give me any chocolate. It's his fault that I'm crying. And as adults: my partner doesn't behave the way I want. My employer treats me unfairly. And if my wealth decreases? Then the markets are at fault. 

Western thinking is clearly positioned between the two poles of blame and self-responsibility. We easily see how others contribute to their own misfortunes. Doing the same for us is much harder. I too plead guilty as charged. In my defense: I am at least trying to condition myself into the model of self-responsibility and slowly take leave of old behavioral patterns. 

The Market is Like the Weather

Doesn't the craft of investing lend itself wonderfully to shifting blame? The market is like the weather you’re exposed to. It's not my fault if it rains, right? Who could have foreseen consumers suddenly shifting demand to a different product? Or energy costs skyrocketing, making business models unprofitable? Justifications for blame are endless.

Investing is always a venture into the unknown. This unavoidable leap makes the process of investing so challenging, but also appealing. Being wrong and suffering setbacks are part of the business and no reason to make excuses. We must take responsibility, decide, and move forward. 

Every year, at least one stock in the portfolio is the talk of the town when its price comes under massive pressure. Even large, established companies can lose over half their value within a year. Such extensive price swings are unfortunately not uncommon. Every practicing investor is therefore very skeptical of the argument that markets are efficient.

Taking Responsibility for Investment Decisions

Of course, seeing a stock halve still hurts. But perhaps this offers a unique opportunity to buy more shares of a fantastic company at a discount? Or maybe not. This brings us back to venturing into the unknown and taking responsibility.

The investment discipline in the Gutmann Core Equities strategy forces us to make active decisions multiple times a year (more on this here). We don’t just watch passively when prices swing. No, we must act - buying or selling. This requires conviction and the willingness to take on responsibility.