Packers make a historic come back.
While watching yesterday Green Bay Packers vs Dallas Cowboys at a good friends home I was amazed at the remarkable comeback by the Packers in the second half. The Packers were down 26 to 3 at halftime as I was NOT optimistic about the Packers prospects for the game and the season. The offense was very ineffective and the defense was nearly non-existent.
I personally did not like what I saw and had little hope for a win. Things changed dramatically in the second half. Before we knew it, the score was 29-17…wow! Then it was 36 – 24. With minutes left the score was 36 -31 when the Packers intercepted Dallas. With less than two minutes to play Green Bay scored giving them the lead at 37 -36. This ended up being the final score.
But what does this have to do with investing, other than a fan bragging about his team? When Dez Bryant of Dallas made a great touchdown catch with 4 minutes to play I said a loss here would end the Packers season. My friend reminded me that the games was far from over. In other words never give up.
Today I sit thinking about this and what happened in 2008 to the financial markets. There seemed to be nothing but bad news and it continued for some time. Being invested in the stock markets was very painful. Many gave up and sold near the bottom. But with proper investor coaching many persevered. In fact an investor coach would have rebalanced when things seemed very bleak. Equities were dramatically down and U.S. Treasury bonds were up. Therefore we sold U.S. Treasury bonds and bought the downtrodden stocks bringing us back to our asset allocation target. (We bought low and sold high.)
We had a process, a process we believed and remained disciplined to. Like Green Bay Packer coach Mike McCarthy, your investor coach would not allow you to panic and sell your stocks at a low. Coach McCarthy had a process that he believed and his players believed in. It’s not about predicting the future it’s about remaining disciplined despite the dire circumstances.
Even during the worst of times which seem to go on forever. These ‘bad times’ are short term in nature and will pass. Like the Packers on Sunday it required a cool headed coach and a process.
Plan to succeed and hire an investor coach.