Since I will be a traveling man for the next few weeks, I thought I would tap into some of my right brain abilities, limited as they may be, and share some haiku investing with you for the next two weeks. Haikus are pretty fun to noodle around with because of the limits they impose on the creator of them. They have to be three lines in which the first one has five syllables, the second seven, and the third line five syllables. That’s it. No more, no less. They’re also known for bringing together images, concepts, ideas, and themes that don’t seemingly go together.
While I stay fairly uniform in my investment haikus, I have found that finding connections between the seemingly unconnectable can generate keen insights from time to time. I hope you enjoy these and look forward to any feedback you may have.
Haiku Investing
Spend less than you earn
Step one in becoming rich
Start saving today
A dollar not lost
Is not valued highly enough
Losses are a tax
When the odds are right
Load the boat courageously
This grows capital
Use leverage wisely
It can be your friend or foe
Debt magnifies returns
Focus on what you know
Avoid that which you don’t know
And then you will know
Impulse kills capital
Check your emotions always
Patience is a virtue
Live below your means
This builds a margin of safety
Be thankful for limits
Independent thought
Keeps one away from the herd
This reduces risk
Keep a lot of cash
Always remain on the field
This creates options
Stay out of corners
Optionality is key
Watch Dirty Dancing
Seek worldly wisdom
Go study mental models
And learn from others
Cultivate courage
This will compound capital
Risks must be taken
Don’t lose sight of taxes
Make Uncle Sam your partner
Defer when you can
Your job is job one
Your circle of competence
Don’t lose sight of this
Don’t be a miser
Enjoy the fruits of labor
Make the world better
Focus on your basket
Don’t over diversify
Attention to details
Listen to your gut
The right brain has great value
Analysis has limits
Know that you don’t know
This was Socrates’ brilliance
Markets are humbling
What is your premise?
Articulate the reasons
One must expect change
We all have cash needs
Monitor liquidity
Don’t get over your skis
Tame your emotions
We are our worst enemies
Respond, don’t react
While gains are welcomed
Focus on loss avoidance first
This manages risk
Over to You:
Well? Did you enjoy my Haiku Investing?
I like your Haiku Investing! When you say “Debt magnifies returns,” are you referring to all debt, minimum debt or variable rate debt? I think I know what your meaning is but thought I’d ask for clarification.
I have one I try to follow,never ever spent the principle