I have been thinking a lot about my purpose in trading and investing lately.
I started trading a small account on the JSE in 2003. In 2011 I opened an offshore account. I have always had an absolute fascination with markets and a desire to try and work them out. This of course will never happen and even the brightest minds have blown up accounts and left the markets. However, back then, besides my fascination, I guess deep down, my idea was to have a side hustle that could spin off some cash so that I could escape the corporate march someday. That was always my aspiration as a young and free 20-something-year-old. Now, almost 20 years on, I have a wife and two sporty young bright boys. I have just left the corporate world after 6 years at Unilever and 15 years at SAB-Miller / AB-InBev. I work in a smaller organisation with exciting growth prospects but of late I have been thinking a lot about time and purpose.
The late Van K. Tharp, who recently passed said the following on episode 76 of Steven Goldstein and Mark Randall’s The Alphamind Podcast:
If you could have anything in the world, what would it be?
They might say: “I want $1 000 000”.
If you then asked them, “If you had that, what would it get you?”
They might then say: “I would be able to buy this, this and this.”
If you then asked them: “What would that get you?”
They may say: “I’d feel more secure.”
If you challenge them further and ask them what security would get them, they could say something like: “I’d feel more peaceful and happier.”
What if you could get peaceful and happy first?
Back in my 20’s it was all about a dreamier future. In mid-life, my wife and I find ourselves searching for a larger home so our boys can live out the rest of their school years. After that, they will be gone, and so will the school fees, and the nest will be empty and I will be in the next stage of my life. So, what am I actually saving for?
In 2018, Tom Canfield, a trader of 20 years, lost $500k in 1hr. It took him 18 months to make the money back and 3 years on, as he relayed the story on The Alphamind Podcast (Episode 62), the emotions were still stirred up. He returned to the podcast a year later (Episode 84) after having had a heart attack. On this podcast he spoke about how he didn’t realise how much of a toll full-time trading had taken on him. He was also always chasing some dream of a ski house in Aspen where he and his wife and kids could live someday. As the kids grew up and left home (and the private school fees and sports clinic fees lifted), he let go of this dream and bought in a new state closer to his kids. He is much more fulfilled, peaceful and happy.
Turney Duff worked on Wall Street and was enormously successful. Unfortunately, he got hopelessly addicted to cocaine and his career eventually came crashing down as he lived the high life on Wall Street. He wrote a book telling his story: The Buy Side: A Wall Street Trader’s Tale of Spectacular Excess. Now divorced, as he relayed his story to Aaron Fifield (Chat With Traders, Episode 106), he stated that he went from being a guy who wanted to live the good life to a guy that wanted to live a good life. He states that when he made this shift, that’s when it all clicked for him. He now lives in Long Island, 40 miles outside of the city and 2 miles from his daughter. He writes and has a simple life, paying $1300 a month for rent, barely gets by and just tries to be a good father. He then goes on to state that he has never been happier!
I think it really is dependent on where you are in your life but my message to you is: know your purpose as a trader or investor. Is it to teach? Is it to raise cash to help Ukraine? Is it to feed your ego? Is it to gain some validation on Twitter? Is it to get filthy rich? If so, what will you do then? Know yourself and know your purpose, first and foremost. Don’t postpone contentment. Be obsessed about markets but have balance outside of that. Live each moment in life and try to do something good for others. Life is short.