Labor Day is always a good time to reflect on people who love what they do. The recent passing of famed investor Julian Robertson at the age of 90 got me thinking about other legendary investors who also lived very long lives, including those still living. These include Charlie Munger (98), Arthur Rock (96), Warren Buffett (92), George Soros (92), Carl Icahn (86), James Simons (84), Sam Zell (81), and one of the founders of CWS Bill Williams, who is still going strong at 90. They are all still alive and very vibrant. And if I wanted to go into the next level of youth, those in their 70s, the list grows significantly with names such as Steve Schwarzmann, Henry Kravis, Ray Dalio, Peter Lynch, and Howard Marks, just to name a few. I might as well add Steve Sherwood to the list, who is my partner at CWS and the person I have learned more from about investing and business than anyone. What a gift it’s been being able to work so closely with such a kind and brilliant man for all of these years.
CWS Founders – Investing Legends
And since I’ve mentioned the W (Williams) and S (Sherwood) in CWS, I might as well throw in the C, Jim Clayton, who has also reached his 90s. I had the pleasure of taking a photo of them recently during an unplanned get-together. What a treat it was to see them reconnecting and reminiscing. And they all look so good too!
Now let’s move from the living to those who have come and gone but surely left their mark. Notable ones who passed away are John Templeton (95), Philip Fisher (96), Ralph Wanger (96), Kirk Kerkorian (98), Irving Kahn (103), Philip Carret (101), Walter Schloss (93), John Bogle (just a few months shy of 90 when he passed away). I am sure I missed some other notable ones, but I thought this group was a very good representation of highly successful investors who lived very long and prosperous lives.
Reflecting on My 35 Years With CWS
Reflecting on this list made me curious about what it was about these individuals and the profession they worked in for so many years that helped contribute to their longevity. I’ve been working at CWS for 35 years, and I’ve personally seen how stimulating it can be to be able to work daily with very bright, energetic, and ambitious people with whom I have very rewarding relationships and the opportunity to share ideas and insights to test our assumptions, bounce ideas off of, and to bring our blindspots out of the shadows. Being intellectually stimulated and having strong relationships are known contributors to longevity, and these individuals had both of these in spades.
In order to navigate the turbulent world of investing over a long period of time such that the end result is prudent management of risk and compounding of capital requires immense curiosity to develop pattern recognition, a ruthless level of humility to recognize errors and learn from them, the courage to take action, even if it goes against the consensus and people think you’ve lost your mind, an independent streak to block out influences that may inhibit clear thinking, and the emotional fortitude to stay in the game even when things are not going your way. Or, as Charlie Munger has said in his typically blunt way:'If You Can't Stomach 50% Declines in Your Investment, You Will Get the Mediocre Returns You Deserve.'Click To Tweet
There are so many variables that influence investment returns. I know this has been the case when it comes to my career in real estate, which has been focused on housing. It has required thinking a lot about financial markets, interest rates, demographics, drivers of real estate demand, social changes, geopolitical factors, Federal Reserve reaction functions, supply assessment, understanding human nature, behavior, psychology, etc. It requires a potpourri of knowledge and deep curiosity as well as a tenacious desire to win, or more importantly, not to lose, to avoid ruinous bets, and to make large, prudent wagers during those rare times when the odds appear strongly in your favor to capitalize on very favorable risk-reward situations.
Another characteristic of most great investors is that they are avid readers, and I have to assume that this cognitive enrichment can only benefit greater life expectancy. They are hungry consumers of information, and they always keep their minds open because they never know where and when inspiration may strike or be triggered by input from something they read or a conversation they may have had. They always have their antennae up to pick up crucial signals, and great investors are quite adept at learning about how different businesses work, what drives their profitability, and where their big risks lie. This allows them to build up mental models to allow them to develop pattern recognition such that these investors could say that “While I may not have seen this exact movie before, I have seen many with very similar plot lines such that I have a pretty good idea as to how it will end.” This helps them separate the signal from the noise and not get caught up in jumping on the bandwagon and taking on too much risk.
As it’s been famously said when it comes to investing, what the wise do in the beginning, the fool does in the end. Their invaluable experience, emotional control, independent thinking, and long-term horizons have enabled these investors to be the smart money that spots compelling situations ahead of others and to be able to exit when the investments become too popular and correspondingly overvalued.
All of this deep and purposeful thinking cannot help but expand one’s horizons and sharpen the mind, which can only serve to keep them cognitively strong for many years, which, as previously mentioned, must be very helpful for increasing one’s life expectancy.
And while great investors often have a solitary streak as they are often outsiders looking in (e.g., Buffett in Omaha, Munger in California, Templeton in the Bahamas), a lot of them also have deep social networks or connections with very bright and interesting people (e.g., Buffett and Bill Gates). They have the resources to enjoy their lives fully. They can also access the best medical care that money can buy if they have health issues and be proactive to avoid problems.One cannot be a successful investor without being thoughtful, rational, clear-headed, emotionally stable, decisive, courageous, and a strong communicator. All of these attributes contribute to being wired in ways to handle stress and challenges in a healthy manner.Click To Tweet
One cannot be a successful investor without being thoughtful, rational, clear-headed, emotionally stable, decisive, courageous, and a strong communicator. All of these attributes contribute to being wired in ways to handle stress and challenges in a healthy manner. There will always be setbacks in life. The important thing is how one handles them and takes advantage of such times to learn, grow, and become stronger.In my experience, people who are hit with a rogue wave either sink, stay afloat or find a way to adjust to ride that wave and thrive.Click To Tweet
In my experience, people who are hit with a rogue wave either sink, stay afloat or find a way to adjust to ride that wave and thrive. All of these individuals are the ones who not only survive(d) but thrive(d) when times get tough. but positioned themselves to be able to capitalize on the opportunities that materialize when there is the proverbial blood in the streets. They can go on offense when so many others are on defense because they understand risk thoroughly and have come to learn that the real rewards come not from riding the wave of a bull market but by buying assets at very compelling values because they are in weak hands and their owners require liquidity. Providing liquidity at a time when liquidity is at a premium is one of the roads to riches.
I hope that I can continue to add value and contribute to preserving and growing the wealth of our investors as I march down the road of life. It’s been a fascinating and extremely rewarding journey, and It’s hard to believe that if I live to Warren Buffett’s age and continue working as he has, my career has only progressed halfway.
Happy Labor Day!