Stoicism talks about the concept of Memento Mori, which means ‘remember that you are mortal’. Before you label me as a depressed guy, hear me out (or rather read ahead 😊 ). Stoics believe that by remembering about death every day, instead of being depressed, it adds more fuel to one’s life.
In ancient times, people encountered risk to their lives, far more often than today (except for few professions). In modern times, we are more secure and our brush with death is far more infrequent. This has meant that we are far more scared of the end than our forefathers.
What has this got to do with Investing?
Investing (especially into equities, though not necessarily) is a non-linear experience. As humans have progressed, we have removed unpredictability from several walks of our life. It makes sense as well, since it improves efficiency, the hallmark of progress. Google maps, Netflix recommendations, Outlook calendars are all tools in this pursuit.
However, investing still demands acceptance to unpredictability. Forget equity, in CY 2022, most bond funds in US delivered returns even lower than -10 %. So, without doubt volatility is intrinsic to investing. Therefore, it only makes sense to befriend it. In fact, the best of investors, seek volatility and love it.
Easier said than done? Absolutely and hence investors keep measuring a fund manager’s performance over months and quarters, which is ridiculous to put it mildly.
Ok, enough of gyan, ‘karna kya hai ?’
Like most things in life, not every problem has a solution 😊. But being aware is the first step and an important one at that. So, just like one should keep reminding oneself every day, about ‘Memento Mori’, maybe once a month, remind yourself of ‘Levitas est amicus meus’ (Volatility is my friend). Don’t judge my Latin now.
P.S : Also don’t forget this song from the very famous country musician Tim Mcgraw Live Like You Were Dying (it has nothing to do with investing, I just loved the lyrics)
Disclaimer : There isn’t a need for regular disclaimer for this one 🙂