(Public) Memo - Hard Work
By: Wilson
The title of this memo holds a special place in my heart. I have never been a believer in being talented or gifted. Hard work, perseverance, and consistency are the cornerstone of any successful person. But in markets, this doesn't always feel like the case. And instead of talking about investing/trading today, I will use my favorite topic, golf.
I reached a personal milestone this week. My handicap index hit +4.7. My prior high was +4.4 and I reached that late 2022. Since then, I've been muddling along the path of misery with no forward progress to be seen.
Note: Normal handicap is subtracted from your score, and a + handicap is added to your score (i.e. lower than a scratch).
For anyone who has ever picked up the dreaded/beautiful sport of golf, you will know that the slightest mistake can lead to disastrous results. My wife recently picked up the game, and boy oh boy, is she learning the hard way just how tough the sport is.
In golf, the most important things are the fundamentals. Grip, stance, posture, and alignment, yet most people ignore those things and fixate on how they hit the ball. But as any golfer knows, without proper fundamentals, a good swing is bound to break down over time, and when it breaks, all hell breaks loose. That's why repeatability is the name of the game in golf, and while some amateurs can do it for 1 round at a time, it's a different beast to do it 4 days in a row and for 26 weeks straight (pro career).
That's why I admire pro golf, while simultaneously vomiting at the idea of ever becoming one.
But at one point sometime this year, I was "this close" to quitting. Simultaneously, at one point this year, I was "this close" to quitting energy investing.
What's the point, I thought? All the time I spent on the range with my tripod filming my swing, using Trackman, and doing difficult drills, they are all a waste of time. I'm not going to be a pro. This is not going to put food on the table. Why am I wasting my time doing this?
But then I remember my memo, "How you do anything is how you do everything." It's not the act that counts, it's the attitude. While the results never come right away, the process, the grind, the attitude, they almost always lead to results.
Or that's what I kept telling myself at least over and over again. Anytime I get down, I tell myself that. Anytime I lose confidence, I tell myself that. And like a broken clock stuck at the same time, eventually, it's right two times out of the day.
But hard work is never enough on its own. You need feedback. You need honesty. And you need a disciplined work ethic. Just because you spend time toiling away at hitting balls doesn't mean you automatically get better. Unlike most sports, golf is a game where if you practice incorrectly, you will get worse. And similar to life and investing, just because you are moving forward doesn't mean you are moving in the right direction.
Oh the stark contrast between the three and how I can write all day about it, but the reality is simple, hard work isn't enough, the right type of hard work is the only way to real improvement.
Will it be worth it?
I think the thing that scares people the most (when it comes to working hard) is the uncertainty of not knowing whether or not it will all be worth it at the end of the day. If someone could tell you from the beginning that if you work hard, everything will work out. I'm sure most people will do it. But it's during the journey, the results not validating the hard work you are putting in that keeps people at bay. I mean just look at Jensen Huang, CEO of Nvidia, talking about the hardships of doing a start-up!
Here he is, CEO of one of the most successful companies of all time, telling everyone that if he was 30 again, he wouldn't do it.
Think about that for a second. How many people would be willing to admit that the journey may not have been worth the result... And that's coming from a guy with a net worth of over $86 billion. (Assuming here that money is the barometer for success, of course.)
But like what Jensen is saying in the video, entrepreneurs have a special superpower to convince themselves that it's easier than it looks. Or as I like to say, "eternal optimists." Because at some point, none of this makes any sense. All you feel is burden, and like Elon Musk said, "Staring into the abyss and eating glass." It just doesn't feel like it's worth it. But we all endure it anyway, because I guess we are all just a little psychotic in our own special way.
If you do it right, it's always worth it...
Hard work is almost always worth it. Because it's the journey that counts, not the results. While I am a strong believer in that, I can still fall victim to the result-oriented mindset at times. And just like the hardship I had to go through to make all those dreadful swing changes to get better, they all end up being worth it at the end of the day. Because you can look back at the progress you made and acknowledge that all those sacrifices were not in vain.
I think for all of us dabbling in the market, that's the same mentality we need to have. You are not always going to make money, but you can damn sure improve your process to the point where you do. And just like sports, having a good feedback system to help improve that process is paramount to improving for the better. This means that you have to be brutally honest with yourself. And if you want to make life slightly easier, find other people who are willing to be brutally honest with you.
I find it much easier to have Nelson Wu of Open Square Capital tell me I'm stupid than to call myself stupid. But hey, whatever suits your boat.
Parting Thoughts
Perhaps I'm being delusionally optimistic thinking that the "right" hard work always pays off, but I'll take this mentality to the grave if I have to. Because at the end of the day, that's the only way I can convince myself that the journey is more important than the result.
Analyst's Disclosure: I/we have no stock, option or similar derivative position in any of the companies mentioned, and no plans to initiate any such positions within the next 72 hours.