In interviews, I am often asked for my favorite book on investing. I have a hard time answering that. The reason why is that when we read a book, and what we have read before that, on any particular subject have a huge impact on how any individual book affects you. When reading we are simply trying to build incremental knowledge and insight. A book that impacts me in a particular way may be beyond boring for you.
The same can be said for the self-help listicle. We all know it when we see it, something like: “Six things self-made millionaires do before breakfast.” The issue isn’t necessarily what’s on the list. Taken individually they all may be perfectly sensible. However the notion that taken together they represent some key to success is a dangerous one.
Success, depending on your definition, is a function of many things include skill, luck and grit, to name a few. Everyone’s path toward success is unique in its origin, execution and outcome. James O’Shaughnessy took up this issue in a Twitter thread, which I recommend in its entirety. Talking about these ubiquitous self-help listicles he writes:
3/ Bad news: NO, you won’t. That’s because successful entrepreneurs all tend to do DIFFERENT things in the morning. Millionaires that self-select themselves to answer pages and pages of questions might share traits, but they are a TINY fraction of all millionaires.
— Jim O’Shaughnessy (@jposhaughnessy) November 10, 2018
On the whole the listicles are likely to be relatively harmless if acted up on in their entirety. What isn’t harmless is the idea of ‘hustle porn.’ This is a term Reddit founder Alex Ohanian has coined and talks about the idea floating around the startup scene that the only path to success entails working yourself ragged. In a recent talk Ohanian said:
“It has deleterious effects not just on your business but on your well-being…As entrepreneurs, we are all so busy ‘crushing it’ that physical health, let alone mental health, is an afterthought for most founders…Please do not succumb to hustle porn.”
One of the great contradictions in investing is the idea that if you work harder it will manifest itself in better returns. Even for skilled managers there is no guarantee of success. Investment returns are an amalgam of skill and luck, with an emphasis on luck. This is a hard idea for many to grasp, but it can be the basis for a more healthy approach to the markets.
There is no simple formula for success, investment, personal or otherwise. A surefire recipe for failure is not taking care of your physical and mental health. We are all unique individuals whose goal should be incremental improvement. Sometimes that improvement will manifest itself in conventional success, sometimes it will only represent an accomplishment only known to ourselves. Being satisfied with incremental improvement doesn’t induce clicks, but it is all we got.