On an otherwise unremarkable day in April of 2012, another major league pitcher wound up in the history books. He walked off the field with an official perfect game on his record, one of only 21 players in the modern era to do that.
Since 1880, 132 years, somewhere in the neighborhood of 800,000 pitchers have taken the mound at the beginning of a major league game with a chance to accomplish that same feat. And only 21 have achieved the ultimate success. One in every 38,000 chances. There have been stretches of 22 and 33 consecutive years of baseball when no one has done it.
Perfecting Your Investing
I’ve often thought that investing had a lot in common with baseball. But nobody pitches a perfect game in investing over the long term. Not even Warren Buffet.
Most pitchers don’t take the mound thinking they are going to, or need to, pitch a perfect game. When it comes to investing, you shouldn’t either.
It's not necessary to pitch a perfect game to be successful in baseball - nor investing. And when it comes to investing, aiming for perfection can really hurt your returns.
Last year’s baseball world champions, the St. Louis Cardinals, played 162 regular season games. One pitcher or the other lost 72 games for the Cards during the regular season – 44% of their games – and they still wound up champs.
Being Successful, And Realistic
As long term investors, it pays to be realistic and know we’re not going to win them all. There will be long stretches when seemingly nothing works and everything seems to be a loser. We’ll make some bad pitches. Or we’ll stick with a starting strategy too long, well after it’s ‘lost its stuff.’ Sooner or later, some business executive or money manager we trusted will make an error and cost us. And, almost all the time, even if we’re doing great with an investment, there will be others that are doing even better.
Fortunately, while investing during that long game leading up to retirement, a couple of bad pitches or even some embarrassing losses don’t mean we can’t win the game. Advice from old baseball coaches to their young players rings true for those seeking investment tips as well . . . .
- ‘Stay within yourself’ – Don’t venture into perhaps currently popular investing areas that you don’t understand.
- ‘Don’t try to win it all by yourself’ – Put a professional fee-based advisor on your team, even if it’s only for a checkup every couple of years.
- ‘Just worry about the next batter’ – If you’ve had a loss, don’t let the emotion of that experience affect your next outing. Analyze what happened and try not to repeat the mistake.
- ‘Ya can’t win ‘em all’ – Ya can’t win ‘em all.
I’ve often thought that investing had a lot in common with baseball.
