You Gotta Finish
By Brad Thomason CPA
2/6/2015
Remember the story of The Tortoise and the Hare? If you ask a room full of adults what the moral of that story is, you will hear, in unison, “Slow and steady wins the race!” I know, because I’ve done it at a number of speaking engagements over the years. I bet that was what you were thinking, too.
I first heard this story as a young child. But something about the conclusion didn’t seem quite right, even back then. Over the years I came to believe that we had missed the point. So in contrast to the classic response, if you were to ask my kids the same question, they’d tell you, “If you have your opponent on the ropes, keep slugging him until he goes down.” Which of course, is what their Daddy has told them all their lives. And what I really believe the true moral to be, by the way.
I’m not opposed to steady progress, and I certainly applaud the idea of staying with it. Some situations do indeed yield to that kind of approach better than others. Erosion is, after all, one of nature’s most successful business models.
But focusing on those elements glosses over the fact that the only reason the hare didn’t win is because he essentially elected not to. He goofed off. He lost focus. He didn’t finish. He didn’t win. Wasn’t a case that he didn’t know what to do, nor that he lacked the resources to pull it off. He just didn’t finish.
Sometimes investors do that too. They know they need to plan, but they don’t. They know that the investments they hold aren’t getting the job done, but they don’t look for alternatives.
Investment performance is of course tied to what your money is in as opposed to what it could be in. If you know what to do and have the resources to do it, you can’t say you’ve finished until you actually move the capital to the better configuration. In many things, action is required to bring to fruition the goal you were striving for in the first place. For investors, that action is reallocation.
So, you gotta finish. Or the whole thing doesn’t count for much. Just ask ole Hare.