30 October 2024
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Investment can be a lot like test cricket. It surely is. Which can be explained from Cricketer’s lens and this belief firmed up after watching again the highlights of Laxman and Dravid’s innings of 2001 against formidable Aussies.
Most of the times our investment journey can be dull, stagnant, boring and not leading anywhere (at that particular moment) but that is so untrue because like a game of test cricket it only takes one moment, one move to grab the momentum and get moving again.
Some lessons learnt from the game of test cricket – a corollary drawn.
- Unitize - add and add together
Worthwhile to note that while watching a test match you don’t necessarily notice each run scored or impact of every maiden overs bowled. It takes place ball by ball, run by run and through long periods of a match, slowly albeit. But after the culmination of a days play that we realise how it all mattered.
In investments we often don’t realize the benefit of every SIP unit bought or every additional purchase we do month on month,year on year. The endeavor has to be to play out the day. In investments a day can be 3year/5 years or more,, depending on the goals you have set as a cricket team sets itself before the start of the play.
Everything added together be it units or time spent in the journey can make for a healthy score card read in the end.
- Its Momentum that matters
In a game of cricket the team who make the most of their periods of momentum and satisfactorily weather the storm, will do well. In a five day match its inevitable that one side will always have the momentum if it’s between equals and they have gone out after a thought out strategy. The important point is who seizes its momentum better.
In investments its all about showing up in a consistent and steady manner and very vital for us to ably respond when momentum has swung our way. At other times we have to just concentrate hard, defend, play the patient game and wait for a half opportunity to present itself.
It’s important to know which opportunities to take and which to leave – sometimes its easy to act irrationally because we haven’t scored in a while. You don’t have to get carried away because this is where most investors make big mistakes that can cost a lot. But if we are patient, dig in and then take our opportunities wisely the momentum will shift back certainly.
- Objective – the focus area
Imagine, on 3rd day of 2001 test between India and Aussies if Laxman and Dravid would have thought about surviving the whole of remaining 3 days or some 250+ overs the result would have been different and we would have been devoid of a splendid memory to cherish. Instead what they did was focusing on smaller targets and concentrated on unitizing the match, session by session break by break and eventually seized the momentum and won. For all the intent and purposes they had, it was a mammoth task.
In our investment journey sometimes we all have to hang in there. Set ourselves little targets of action/inaction and the big picture objectives will take care of themselves. Short term volatility or hazy outlook should not deter us from our march towards our objective. Instead unitize these phases and play accordingly. It would not be a bad idea to get a coach for yourself who can guide you if in disarray. Remember you are playing a test match, and not even 2 sessions leave alone the day can be similar.
- Everyone gains experience- that matters the most
Cricket is a unique sport in that it is often impossible or at least inappropriate to be able to answer the question who’s winning? No one is ever winning. A team can be doing well or on top or closing in on victory but even at that point they are not certainly winning. The end result is a byproduct of what happens in a match and tells you nothing about the match itself.
Similarly, in investing you might be making money or not in any idea will be only a by product known at the end of the day but the experience you gain out of that whole process is something you definitely gain. People generally categorise their experiences good or bad depending on final outcome but they fail to realise that it has only made them wiser by a notch and yes they have made a monetary gain or not – they have gained experience, which is most important.
Mr. Shalab Gupta Bibhab, Founder, Bibhab Capital
Disclaimer
The views are personal and are not part of the Outlook Money editorial Feature.
