Investing 101 : Preparedness over Prediction

To write about money and wealth, in times like these, is almost sacrilegious. Perhaps everyone who is reading this would have lost or known a dear one who has lost someone they loved. Such is the agony of the times we live in. 

Yet, life is the ultimate paradigm of mobility. Between pain and sorrow, we are compelled to think about life and livelihood. We resent, but ultimately accept what life throws at us and move on. In moving on, however, the path we take from thereon, shapes our future and impacts lives more profoundly than we can imagine. 

In choosing the path, we can either ignore (as we generally do) the lessons that came, through the perils of the troubled times or pick up our pieces and move forward in a manner that’s more responsible and sustainable.

Last year, the debate was about “lives versus livelihood”. This year, 2021, the debate should be about “Prediction versus Preparedness”. We couldn’t have escaped the agony that unfolded, but we for sure would have saved a lot many lives; had we paid heed to the caution and avoided the cardinal sin of predicting the second wave as “Improbable”. 

“Forecasts are, but predictions only. They are an attempt to eliminate surprises, which points, inevitably, to the lack of preparedness in facing uncertainties.” – Investing 101 : Playing the Infinite Game

Preparedness comes from our ability to recognise positive outcomes. It is almost a skill, that is common sensical or heuristic in nature. Therefore, it needs conscious effort to train our minds, in order to develop this ability. Not an easy thing to learn, as it cannot be taught. It is largely the domain of the autodidacts. The ones who do things for the heck of it.

Once recognised, these outcomes tell us what led us to that point and how do we move forward from there. In investing, this ability leads us to decide what to expect ? how to strategise? whether to take on risk or stay safe ? With time comes refinement and the more we are at it, the better we get.

If you have initiated yourself on this path, you are blessed !! If you are not, you can try to find someone who is doing it for the heck of it !!