The 10 Core Principles
of Zen Investing
I've been a follower of the Zen philosophy since my sophomore year in high school. I don't believe in magical thinking or serial reincarnation, but I do believe that the key to life and investing is to take the simple road, or the road less traveled, as it were.
With that in mind. I present the 10 Core Principles of Zen Investing. I believe in them, and my clients have done very well by adhering to them as much as possible.
- Simplicity – Always take the path that will get you to your destination with the least amount of drama.
- Clarity – Learn to separate the signal from the noise. It’s not hard if you know what to listen for.
- Truth – Learn to recognize what’s real and what’s just a sales pitch. Almost everything is a sales pitch, but the truth is out there.
- Mindfulness – Believe nothing, no matter where you read it, or who said it, no matter if I have said it, unless it agrees with your own reason and your own common sense.
- Balance – Spread your risk across the entire investment landscape. How you tilt your weightings is an art.
- Equanimity – Choose a strategy that is a natural fit for who you are. You aren’t Warren Buffett, so don’t try to be like him.
- Self-awareness – Be unconditionally honest about your biases and tendencies. Be especially mindful of bias blindness.
- Situational awareness – Keep everything in front of you. Don’t let yourself be flanked by the unexpected, because it’s always lurking.
- Courage – Lean into risk, but make sure you are being properly compensated for taking it. Do not fear risk.
- Let the market come to you – Set up your plan, decide on your strategy, and then let the market come to you. Don’t chase the market.
There is beauty in simplicity
The investment business would have you believe that navigating the market is insanely difficult, and you need the advice and counsel of a professional to guide you through this complicated maze. I disagree.
Investing is only as complicated as you make it. What I've found is that investors who spend the most time digging into the minutiae of technical analysis usually end up with sub-par results. I like to keep things simple. It takes less of your free time, and it produces results that are as good, or better, than the maniacs you know who spend every free hour slicing and dicing what the market is doing.
I publish a new article about once every week or so. I keep them brief and easy to digest. The topics are driven by what's happening in the market. When I have something relevant to say about the market, I write about that. And when the market is quiet, I write about investment strategies and offer tips that are relevant to current market conditions.
If you sign up for my free weekly newsletter, I will send you an email with a link to the most recently posted article, along with a short summary of what it's about. That makes it easy for you to decide whether or not it's something you can use.