‘Opportunity waves’ are all around us
Be open to new ideas and work hard to capitalize on them
One of the signs that I must be getting old is that I’m often asked to speak to young graduates about the “secrets of success.”
The message that I deliver is based on two key concepts that are equally as applicable to achieving one’s investment objectives as they are to achieving career objectives: being open to new opportunities and working exceptionally hard to capitalize on those opportunities.
The first concept — being open to new ideas — is a sort of retort to people who say, “That idea was so simple, I wish I had thought of it.”
Great opportunities are constantly surrounding us, but most of us simply don’t have a way to tune them in.
Think of radio waves or cellphone waves. We can’t see them or feel them. But we know they’re there. Why? Because we have devices to capture those waves and turn them into something we can comprehend — sound.
So, too, with “opportunity waves.” They are all around us all the time. Every event produces them, and yet so few people are able to tune them in, probably because the tech giants haven’t created a device to capture them.
Luckily, you shouldn’t need such a device since your brain is already hard-wired to tune in opportunity waves. But, like most of the features on your smartphone, you just haven’t figured out yet how to use them.
The savviest investors figured out long ago how to use that part of their brain. They know every article they read, every interview they listen to and every lecture they attend is infused with good ideas waiting to be received.
When ordinary investors listen to a speaker discuss the challenges of the inefficiencies of peak energy production, they try to discover which traditional energy producer is the most efficient. When extraordinary investors listen to the same speaker, they think about who is leading the new work on batteries that store power created in off-peak times.
When ordinary investors read a report suggesting that oil prices are sure to rise, they investigate which airlines have the best hedging strategies in place. When extraordinary investors read the same report, they investigate which aircraft manufacturers are working on future-friendly designs that dramatically increase fuel efficiency.
And when ordinary investors arrive home to find their teenage kids ditched their chores to video chat with their friends, they get upset and take away the kids’ devices. Extraordinary investors also get upset and take away their kids’ devices, but not before figuring out what new apps they were using and how to invest in them.
Tuning in to these opportunities, of course, is only the first step. After all, the adage that “the harder you work, the luckier you get” is just as true in investing as it is in sports.
In order to get lucky with new investment ideas (or at least to get lucky on a regular basis), there is no proxy for hard work, and a lot of it.
In the same way that engineers work for thousands of hours on super batteries to store power or aircraft winglets to increase fuel efficiency, investors who come across a good idea must work diligently to satisfy themselves that the idea has merit, can be monetized and is in the hands of people both capable of bringing it to market and skilled enough to run a business that is portable and scalable.
All the hard work in the world won’t turn mediocre investment concepts into winners. And all the good ideas in the world won’t bear fruit without the hard work required to translate them into actionable items.
Study the great success stories over the centuries and you’ll find that, without exception, the ones remembered through time were those of extraordinary thinkers with extraordinary work ethics. As with yin and yang, you can’t have one without the other.