A True Investment/Fish Story
- Whether you’re fishing or investing, patience and persistence are keys to success.
- Just as anglers can’t predict exactly where and when the fish will bite, investors know you can’t predict exactly when the capital markets will produce above average returns.
- But we know from history, if we miss those perfect moments, then we have little chance of having a successful experience—you must have your line in the water at all times.
As many of you know, I’m an avid fly fisher. Recently on the Madison River I had an epiphany. I had been fishing with a good friend for about six hours. Sure, I had caught a few fish– nothing spectacular—but my luck was about to change. Looking about 20 feet upstream, I noticed the distinctive nose of a trout poke through the turbid water as it ate a fly on the surface. Because of the nonchalant way the fish rose to the fly and because of the way the water moved when the fish moved, I knew it was a nice-sized trout. Not a trophy, mind you, but it caught my attention nonetheless and I zeroed in.
From the bank of the river, I cast my fly upstream and it landed about two feet above where the crafty trout waited in ambush. I focused on the fly as it bobbed along with the current. It was one of those special times when things just seem to be moving in slow motion. The trout’s nose reappeared and in that split second, my fly disappeared and I set the hook. Several minutes later, I finally landed a beautiful 18-inch Madison River rainbow trout. Then I happily removed the hook from its jaw and released it back into the river. It’s all part of the sport: “catch and release.”
For the next hour and a half, I repeated the exercise a dozen times as I moved slowly and confidently upstream. It was 75 degrees and sunny. I was fishing with a great friend and I was catching trout in one of the greatest fly fishing streams in the world. Paradise.
What successful fishing and investing have in common
Later, as I sat on the riverbank and reflected on the day, it occurred to me that what I had just experienced on the Madison was not unlike what we experience as investors. You have to have the patience to stay focused through long periods of simply “testing the waters” suddenly punctuated by sharp brief periods of excellent “fishing.”
In fishing, we can’t control the weather or the mood of the fish. But we can be present, with our fly on the water, ready for the fish to be active and hungry. Investing is the same. We can’t predict exactly when the capital markets will produce above average returns. But, we know from history that if we miss those perfect moments by being out of the market, then we have little chance of having a successful investment experience. We have to have our investment lines in the water at all times if we want to catch the prized fish that appear at brief, essentially random intervals.
One thing you can predict is that I’m always willing to discuss investing or fly fishing with anyone who asks. Contact me any time if you’d like more information about the dangers of market timing or the pleasures of successful long-term investing and fly fishing. You don’t have to be an Independence Advisors client. And if a close friend or family member is having doubts about the current tools in their financial tackle box, please let them know about our free second opinion service
Charles P. Boinske, CFA
Independence Advisors, LLC
620 Lee Road
Wayne, Pa. 19087
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