My father was a payroll clerk, but his real passion was investing in stocks, back in the day when you still obtained quotes from a newspaper and trading was done at a high commission through calls or snail mail to your broker. In fact, my father kept paper stock certificates in a gray metal lockbox stowed away in my closet to save on the custody charges brokers levied at the time.
He automatically reinvested the dividends and regularly added to his holdings—a true disciplined, buy-and-hold investor. But even if he wasn’t, the obstacles to gaining information and trading imposed discipline. Contrast that with today’s environment, with its constant barrage of data, noise, and hype, and the ridiculous ease of executing trades on a whim. It’s no wonder that people often sabotage their investment portfolio, either through unnecessary trades or, at the other extreme, paralysis from just being overwhelmed.
Discipline is absolutely needed when it comes to any endeavor. Can you imagine entering a marathon without months or even years of training and preparation? But, unlike exercise, dieting, and most other activities, discipline doesn’t necessarily have to be hard work when it comes to investing.
