By Rick Lear, Lear Investment Management
From the “Ground Hog Day” Soundtrack
The great Bill Murray starred in the classic comedy movie “Ground Hog Day” in 1993. The movie is about a weatherman named Phil Connors who wakes up each morning to experience the same day, February 2, over and over again.
The phrase “Ground Hog Day” has become synonymous with the déjà vu feeling of repeating the same monotonous and challenging day.
In the movie, Phil awakens at the same time each day to the alarm clock playing the same song—“I Got You Babe” by Sonny & Cher; the irony is that Phil doesn’t have anyone. Phil finally breaks the negative pattern by doing good for the world and making the best of each day as opposed to living in a selfish and gluttonous manner. Some would call this “working out karma.”
It has been 27 years since the premiere of “Ground Hog Day,” yet the movie has never been more applicable to reality than now. We’ve been waking up to the same news each day for the past several months: flattening of the curve, masks, dirty politics, lives lost and jobs furloughed.
In the investing world, “Ground Hog Day” looks similar. We continue to hear stories of investors, both professional and novice, expressing their frustration with missing the ride up in the markets and now scared to get in the market. We have listened to numerous stories in the past couple months of investors not achieving their goals due to emotional investment mistakes. Not surprising, many of the investors that missed this rally have a history of making moves at the wrong times. Like Phil, the weatherman in the movie, perhaps changing your current patterns will change your results.
According to researchers at Michigan State University, the average human has 80,000 thoughts each day. Further, the majority of thoughts are repeats from the prior day. These thoughts become actions and the repeated actions become patterns or habits. If you are not achieving your investment goals, perhaps this is the time to make a change to your thoughts, patterns and outcomes.
We believe there is a new way of thinking required to navigate these volatile times. The keys are to understand the fundamental drivers of the stock market, selecting securities that are appropriate for the conditions and then making adjustments when the data changes.
The sharp declines in markets have ALWAYS resulted in tremendous opportunities for skilled, patient investors. The declines are a gift for those prepared to take advantage of the lower prices. It is important to seek advice from those skilled in giving good, unemotional advice. This is a tricky business—it often takes “tough love” to tell somebody they are wrong. The investment plan and portfolio management discipline were designed for the volatile times.
At the end of “Ground Hog Day,” after becoming a good person, Phil still awakens to the song “I Got You Babe,” but this time it is a new day, he’s no longer alone, and his future is bright.
Perhaps the world needs to take a lesson from this film. Our fate will not change for the better until we change the way we think and act. Instead of thinking of 2020 as purgatory, think of it as a gift to change your thinking and ultimately your life.
“There ain’t no hill or mountain we can’t climb”
Rick Lear is the Founder and Chief Investment Officer of Lear Investment Management. Lear is an investment firm founded in 2015 with focus on generating equity returns with less than equity risk.
Lear Investment Management Who We Are video: https://www.youtube.com/watch?v=9uV4RpVN_RA
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