'Investing is running like a marathon'
'Running a portfolio is like running a marathon'
We often come across these phrases in the investment world but we hardly ever think how appropriate they are. Today, I am here to share a recent experience that has led me to believe that running a 10-km stretch and investing in equities are in fact very much similar.
I always wanted to do a 10-km run and I have finally done it. It took a lot of time for me to realise the dream despite having the habit of going for a walk daily. Now, I realise that the delay was due to my 'FD investor' kind of behaviour when it came to running. We often meet investors who want to create wealth but are afraid of venturing into mutual funds and opt for traditional options like FDs. I was doing the same when it came to running — I wanted to become fit but was afraid of trying out something new.
When I finally stepped out for the 10-km run, I realised that it has many things in common with investing. Just like equity investment is filled with uncertainties for a new investor, going on a long run for the first time had numerous risks. For example, the ground I chose was not well maintained and I could spot uneven surfaces, just like market volatility.
I had brought with me a bottle of water, knowing how important liquidity is both in the context of running and investment. My first plan was to run the entire circumference of the ground (650 metre) at one go, take a slight rest and then go for the next round. But after the first round, I realised that this plan was not going to work as it was too exhausting. Then I remembered the concept of asset allocation in investing and implemented it in running. From the second round, I ran the first 350 meters and walked the rest 300 meters.
But I soon faced challenges. Firstly, my timing was wrong. Soon after I started, children walked into the park with their cricket kits. This led to constant disturbance, just like the 'market-related noise' in investing. They kept hitting the ball towards me and asking me to throw it back to them. But, I chose not to pay attention (just like I avoid stock call) and decided to complete the run as per the set plan. Secondly, the excitement of running the first 10 km run forced me to take out my phone and check the progress every few minutes. This was leading to distraction. Again, I derived wisdom from my investing experience to find a solution. Just like an idle investor avoids reviewing his portfolio too frequently, I decided to check the progress only after running for 20 minutes. This helped me run continuously without worries just like investing in equities through SIP.
When I entered the last leg of the run, I moved to a smaller but a better managed park to avoid injuries in the last moment, just like investment theories ask us to move investments to safer asset class once the goal nears.
This is how I conquered my fears and avoided distractions to complete my first 10-km run. At the end I realised that a good wealth lesson can help in building health as well.
At the end, I said to myself: Aaj nahi nikalta to FD investor jaisa baitha reh jata.
As Kabir says
Jin dhoondha tin paaiyan, gahare paani paithi,
Mai baira boodan dara, raha kinaare baithi.
Therefore, if one wants to build health or wealth, one will have to take the plunge into uncomfortable territories.
