It has been now more than a year living under some variation of lockdown in the shadow of COVID-19. As it brought quite a lot of challenges at family, work and personally, I started looking for guidance into topics that I am concerned about.
First one is long-term life strategy and how to make it possible. As it usually turns out being able to finance your personal undertakings is a key aspect.
Finance markets have been growing like crazy lately, I guess thanks to financial stimulus packages and investors’ enthusiasm. At the same time economies and whole industries are suffering greatly. So my big dilemma is what is going to happen next on the finacial markets.
I turned to Benjamin Graham’s book “The Intelligent Investor” for answers and now I am pretty convinced I should have read it about 20 years ago. This masterpiece is some 70 years old now and yet completely relevant and sufficient for my modest needs. In the end I found out that I have been asking the wrong question.
Here is some advice and take aways:
- Find out what type of investor you are e.g. active (enterprising) or passive (defensive). This will make your life a lot easier.
- The factors defining stock market performace are growth, inflationary and speculative. My simple reflection is that the speculative, soon to become inflationary, factors are defining the market.
- “… investing isn’t about beating others at their game. It’s about controlling yourself at your own game.” Else said, control costs, your expectations, your risk and your behaviour.
- Mutual funds work well for passive investors, but it is your task to pick the right ones as few funds outperform the indexes. Look for funds where the managers are biggest shareholders and managing fees are cheap, or at least not beyound standard fees.
- Behave as owner and exert your shareholder rights by participating in annual general meetings.
- Re-read this book every now and then 🙂
The second one is about leading people. With most teams working remotely from home, managing people and teams and achieving results requires even more energy and discipline than before.
So I looked for inspiration at The New One Minute Manager (by Ken Blanchard and Spencer Johnson).
The book outlines a simple system on how to set goals, give feedback (positive or negative) and align behaviour. The book is so concise that you can go cover to cover in just few hours.
In a nutshell,
- always define goals and invest generously your time to write them down in detail
- when a goal was achieved – give praise and explain how you feel about it.
- if the goals was not achieved – revisit your goal definition and check if it was well understood. If the failure was not due to an understanding issue then share how you feel about it.
- Do not forget:
- Working with you, not for you, is what make people enjoy having you as a manager.
- “Goals begin behaviours. Consequences influence future behaviours.”
Now it’s your turn. Looking forward to an interesting book recommendation.