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| Adrian Mastracci, president of KCM Wealth Management, says “I recently gained more perspective on the markets from a most unlikely perch. It came to light while I was riding a horse on some trails." |
For Immediate Release
Vancouver, BC (August 2, 2005): You can never have too much perspective on how the markets behave in the eyes of individual investors.
Mark Twain said in a speech, “A horse thinks of too many things to do which you do not expect.”
Adrian Mastracci, “fee-only” investment counsel at Vancouver based KCM Wealth Management comments, “I recently gained more perspective on the markets from a most unlikely perch. It came to light while I was riding a horse on some trails. Here goes.”
This year, the family and I embarked on a short holiday to do some horse riding at a ranch. First off, I confess I'm a novice rider; my wife has the most experience; and the children were very keen. So far, so good.
Horse tales
We got acquainted with our horses under the cloudless blue sky of the first morning. Then gently proceeded to leave the barn, heading toward the trails with much anticipation.
At first blush, all the horses seemed good natured. However, my first impressions were a little off base.
My horse was co-operative and could be led to do most things, much of the time. The other three were cut from a different cloth. They could easily be labeled as stubborn, hard to get a move on and, at times, somewhat unpredictable.
Getting them to restart after a stoppage was easier said than done. My wife's horse was perhaps the most trying. A tiny bit of frustration set in periodically. But the horses were awfully cute and friendly.
So, there I was sitting tall in the saddle. A long way from the office. No telephones, no email, no newspapers. Just the four of us and acres of rolling countryside.
I had plenty of time to contemplate the beauty of the calm. I daydreamed as I watched the other three horses take command. The rest of the family felt somewhat helpless.
Clearly, the horses had the upper hand, and they knew. It seemed that this behaviour was not new for them. Other riders we met along the trails were having comparable experiences.
As I daydreamed, the antics of the horses reminded me of the striking similarities to the markets. You know, stubborn, unpredictable, often doing things you’re not quite ready for.
Even when I went over to take one of the reins, I got some reluctance to move down my path. On the other hand, they were calm at the sight of a bear eating berries.
Finally, they did move, all in the same direction. We also managed to get them to trot fairly often. Even with a gallop or two.
The second morning brought another picturesque day. We changed horses and proceeded to the other trails. I drew an obedient horse, and my wife’s was reasonably co-operative.
However, the children’s horses were graduates of the famous school called “I’m doing it my way”. There is an investment school of the same name. But, that’s another story.
You guessed it. An outcome very similar to the prior outing, although, we now had a bit more influence. A dose of patience helped immensely.
My horse management skills went up a notch. It still required my wife and I to take the reins from time to time to get the children’s horses to move in unison down the same path.
We bid the horses a fond farewell after a full day of riding. Then went off to trade comparable horse tales with other riders at mealtime. We didn’t feel singled out.
Market lessons
Well, I thought, is there anything investors can learn from such horse trails? Here is my tale:
- Like horses, the markets are hard to predict. But do listen to what they’re trying to tell you.
- Always expect the markets to deliver the unexpected. It’s a bonus if most things go smoothly.
- The unexpected may reoccur again and again. Particularly when you’re least prepared.
- Breathe deeply and keep the finger off the panic button when the markets deliver the unexpected. They’re in control, you’re not, but patience helps your vision.
I’m happy to report that the horse adventures were full of fun for all of us. The horse tales around the dining room table are still plentiful and entertaining. We’re all doing it again soon.
As for the markets, they will always be the markets. If you look closely, their behaviour will remind you of the horse tales I just described.
Mark Twain was right about horses. The same applies to the markets.
Happy summer to you.
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