“The primary cause of [investing] failure is that [people] pay too much attention to what the market is doing currently.” – Benjamin Graham
In a scene guaranteed to evoke empathy in every parent or grandparent with a heart and a memory, a grandfather was in a grocery store checkout line with his toddler grandson when the boy resorted to the time-tested tactic of throwing a tantrum to get what he wanted.
The grandfather did his best to keep his cool. In fact, those close to him reported hearing the old man repeating in a calm voice, “Hang in there, Roger. We’ll be home soon. Just be calm, Roger.”
When he got to the counter the checker complimented him, saying “I have to say how impressed I am at your patience with your grandson, Roger.”
The old man gave the checker a puzzled look and replied, “Oh, no, my grandson’s name isn’t Roger. I’m Roger.”
Like a demanding two-year-old the stock market throws tantrums from time to time. When it does we can learn a lot from Rodger, the patient grandfather. Nothing we can say or do will have any effect on the behavior of the market. Our best strategy is to keep our cool and focus on what we can control, which is our own behavior.
So the next time the market throws a tantrum, stay calm, take a few deep breaths, and repeat after me:
“Hang in there, Roger. It will be over soon. Just be calm, Roger.”