Running Your Own Race

Another post with no specific point....

If you’ve been investing for a while, you have likely heard something along the lines of “you need to run your own race”, ”focus on you and getting better yourself” or ”don’t worry about what others are doing”. However, why is this simple concept so tough in real life? Why must we constantly benchmark ourselves against others? Even with the reality that most of them are strangers with filtered information (like anon accounts on X). Why do articles like this one trigger such primal feelings of FOMO? The truth is, I actually don’t know either but I do find it fascinating.

Getting to the Point

The idea behind this post started as soon as the last quarter ended. That day or two after the quarter end is worse than useless on X. I found myself asking why so many share their results. X is 90-95% men, so they can’t think they are going to win a date unless it’s with a man. I came up with a few thoughts:

• If it’s a newsletter or fund, they are looking to keep engagement up and justify their fees. Which is fine. If you charge for a newsletter or to run money and aren’t outperforming, then what are you doing?

  • If a newsletter with a large following covers/promotes some random company and it pops 10% the next day, was it a matter of the quality of the due diligence or just a herd rushing in? I guess maybe it doesn’t matter to the readers as long as they are making money.

• But if you don’t have a newsletter, why share? It must be the validation that we seek. I want to be clear, I am totally in favor of taking a pause and celebrating success. I think it’s something that most people who are performers don’t do enough. They get a win and just move onto the next challenge without taking time to appreciate their hard work.

  • I should note that I am guilty of this. I like the validation on the good years. And I like the support in the less than stellar years. The words of encouragement give me some added resolve to endure the ups and downs.

• I think that sometimes the people we are in contact with online carry more weight than we think they do for us. I like the support from people on X or substack, many of which I have met in person. But I must admit that I don’t know them as well as my close personal friends and family. When I slow myself down and think critically, getting an atta boy from my folks is 10-100x better than anyone else. My parents don’t know my CAGR, but they see what it has provided me and my family. Plus they can see more than one dimension of me. When you share your results, we don’t ask “at what cost”? Did you sacrifice time with your family or your health for that? Something to consider.

My Thoughts on Performance and Sharing

I thought it would make sense to put down some of my thoughts on performance and sharing results. First, I think it makes sense to track your performance. I mean if we don’t have hard data to see how we are performing, we go based on how we feel. I generally minimize my success and rarely feel very confident in my abilities. So if you asked me how I “feel” like I have been doing over the last decade, I would say something like “probably a bit worse than the Qs.” The real data paints a completely different picture. Second, you can outperform and not tell anyone. I know, I was shocked as well. It still counts if you outperform and don’t tell anyone.

Personally, I don’t mind sharing my portfolio and its performance. It holds me accountable and I benefit from it in several ways. For starters, I enjoy having people comment on the companies I own and, equally, I enjoy offering potential companies to investigate. Currently, I am willing to share but maybe one day I won’t.

There are many things I have to think about when looking at someone’s returns. First, We are all at different stages of life. I live off my portfolio. There is no new capital flowing in for me and I need returns to pay the bills. Second, I am the only income in the house. That pressure is huge at times and can take a toll. I have no interest in betting on lottery tickets to support my family. Thirdly, consistently withdrawing from the portfolio is way different psychologically and logistically than consistently adding. When I was in my early 20s and didn’t have kids, I was saving a ton. I could literally wait like a month or two and save enough to take a large position in my portfolio at that time. Benchmarking myself as a full time investor against someone who is in their 20's and living at home, probably gets me less utility than having a spare tire for my car that doesn’t fit. Lastly, despite it being a matter of math, many calculate their returns differently. IRR, CAGR, % increase in the value, etc can all have subtleties that can lead to the numbers looking better or worse. I can guarantee many of those sharing their numbers on X (especially those who only share the banger years) massage the numbers a bit. And, don’t forget, many use leverage consistently. Is it fair to benchmark yourself against them using leverage if you don’t?

Full Time Investors Who Don’t Share

I know several full time investors. Many have track records that would make yours truly look like a beginner (mind you, I can do that all by myself). Do you know how often they report their returns? Rarely if ever. I only know about their returns because I can tease it out through in person conversations. Many of them have almost no following, because they don’t ever market themselves. However, if we were to look at the measures that count (i.e. how you pay your bills, feed your family, give back to the community, etc) they are knocking it out of the park. They seem to get validation from their results and not others' opinions of them. It’s almost like they are in a different reality from everyone else. They are truly running their own race.

It’s also worth noting that these investors know their companies a mile deep and rarely concern themselves with things that aren’t in their portfolio. If they don’t want to invest in crypto or oil or cannabis, they don’t. They let others invest and make money.

Life Outside Investing

The concept of having a narrow definition of success is not just true with investing. For me, this also happens in lifting. For a long time, I was so focused on getting my 1 rep maxes up for squat, bench and deadlift. I had a pass/fail mentality. If I didn’t get “stronger”, as defined by this extremely narrow definition, I was failing. I would push my body too far and I usually end up burning myself out or getting injured. I wish I could tell you I had some sort of a come-to-jesus moment, a specific moment of enlightenment when my galaxy brain turned on and I was able to decode messages like John Nash in A Beautiful Mind but that didn’t happen. After nursing and injury for far too long, I eventually was just happy to be performing the big three lifts and my reintroduction into strength training became more focused on rehab. With no specific meet in the future, I thought maybe I would take the time and focus on some other movements for mobility and longevity. I also joined a local dodgeball team to help push me into doing more cardio. Gradually, I felt better focusing on general strength opposed to chasing the idea of “getting stronger” as defined by my 1 rep max. For example, rather than focusing on how much of a cheater arch I could get in my bench press, I decided to focus on getting bigger shoulders and being stronger at dumbbell press and push ups. Quick FYI, my shoulders, now, do look bigger and fuller. Similarly, rather than fixating on my squat stance and pelvis angle, I decided to try zercher squats and see how far I can push them. Does the shift in focus mean I won’t compete again? Right now, I’m not really sure. I took a page from Stuart McGill, renowned researcher and doctor in back pain rehabilitation and injury prevention, and have been training to be “harder to kill”.

What’s Your Point?

As with most of my writing, there is no point. No advice to bestow upon readers. Nothing life changing here. It’s just me putting some thoughts out there for others. I just wanted to share that it’s ok to run your own race. And it’s ok if you don’t have the highest returns on X. I don’t and I have done some fairly impressive things.

I hope you enjoyed this. If you have any thoughts or comments on this topic, feel free to leave them in the comment section or shoot me a message. I would love to hear about it.

Thanks for taking the time to read my work.

Dean