Successful investing is not rocket science or about being some mathematical savant as it is often portrayed. It’s far simpler than that. It is really about habits and discipline. But I would go a step further and say that not only is successful investing predicated on good habits and discipline, but success in any field or pursuit in life.
It probably took me until I turned 40 to really understand and appreciate the power of cultivating good habits. When I was younger, I could achieve a level of success through hard work, sheer willpower, and determination. But as I got older, I started to realise that if you aren’t disciplined on the small-ticket items then it flows through to the big-ticket items. Natural ability will only take you so far too and this is as true for sport and business as it is for any aspect of life.
Habits and routines are a really important part of developing a disciplined mindset. Two of the best habits I’ve introduced are walking and writing. I’ve been genuinely surprised by the impact and flow-on effects that introducing these simple tasks into my daily routine have had on my overall performance.
I’ve had a Fitbit for years, but in November 2019 I set myself the target of getting 10,000 steps a day, every day, no excuses, no missed days, no exceptions. I ended up getting to 800 days in a row before I got covid at the start of this year and ended up in bed for a week. I had built a new streak to 250 days in a row before I tore my calf playing basketball 3 weeks ago.
But it does interesting things to your motivation. When you have a streak like this and wake up especially tired or run down you have a decision. Is it worth breaking the streak for that one day of laziness? So far, unless I am physically unable to walk, on every occasion the time invested in accumulating my streak has pushed me on those days to get the steps. It’s helped me lose weight and improve my overall fitness.
When I started writing my weekly insights note to clients in early 2021, I wanted to be sure that I didn’t just start writing it and stop after 4 weeks. My main focus was to make sure I was consistent, so I transferred the lessons from my minimum steps to writing. I set myself 1 article a week and to do that I had to write at least 50 words every day. Most days I write more than that and the finished articles are between 400-800 words. But on those days, I really don’t feel like writing, or I am pushed for time I can dial it down to 50 words and I have maintained the consistency required to build the habit.
What I didn’t expect was how beneficial writing was for me as a tool to help me with my investment process. Writing a note to send out for other people to read makes you challenge the concepts and preconceived ideas you have on a topic. This is particularly useful from an investment perspective. It makes you question your assumptions and your biases. Often when I write I imagine the counterpoint to a view. It’s a great process in identifying if there are any flaws in your rationale. In fact, on more than one occasion I have changed my mind on a topic or view that I held as I held imaginary debates with the people who may query it.
These disciplines are foundational and lend themselves to building additional layers of habits and activities over time. For example, after a while of completing 10,000 steps, I added weight and strength training and then consulted with a dietician to introduce improved eating habits. These days I weigh most of my food. Having consistently produced an article each week I turned my attention to a podcast. Initially monthly, then 2 a month. It’s been just over a year now and we’ve published 22 podcasts so far with a range of great guests. So not only does it matter that you are disciplined on the small things but getting those foundational habits right leads to success in bigger things.