Commiseration happens. As is usual for the last few years, a friendly conversation turned to personal economics. Home improvement projects, preventative health care, and even small luxuries like a new bicycle seat have been postponed awaiting better finances. We’re both writers. He’s more of a wordsmith. We wandered from specifics and played with the analogy of fishing. Fly fishing has an elegance and lots of movement, but sometimes you just have to put a lot of lines in the water. Spread them out. Use different baits and hooks. Take a seat. Be patient. You can be pleasantly surprised at what you catch.
Our conversation went that way because both of us are, ironically, very active people. We both have investments, create art, and exercise our inventive minds. He has a business. I do public speaking and teach classes. We both have very good circles of friends. Neither of us has “enough”. Both of us are frugal and have very good ideas of what that number might be. It can be frustrating to work hard and have a lot of effort seemingly go to waste. He’s the one that pointed out that he and I have lots of lines in the water. Drill into the menu headings above this blog or head out to my web site (www.trimbathcreative.com) and see my lists there. I won’t bore you with them here. His list is different, similarly extensive, but not as public.
We aren’t the only ones. People impress me because everyone has multiple skills. Unfortunately, too frequently, their skills are dismissed by others, or they never find a fertile venue. Others find that their talents are perfectly matched to their time and society. Listen to one of the richest men in the world.
“Take me as an example. I happen to have a talent for allocating capital. But my ability to use that talent is completely dependent on the society I was born into. If I’d been born into a tribe of hunters, this talent of mine would be pretty worthless. I can’t run very fast. I’m not particularly strong. I’d probably end up as some wild animal’s dinner. ” – Warren Buffett
How many people do you know that probably have exceptional and useful talents that are merely undeveloped, mismatched to today’s society, or wrong for their current occupation?
People who have enough, and people who are living within their means, have already caught something and can fish leisurely. Even then it’s good to have something else ready to go, unless it means you spend too much time watching too many lines.
For folks that need to fish, I think the best way to get lines into the water is to do it yourself. Government and other support networks may be too busy to help. Following your passion might lead you to dinner.
This same thing applies to investing. (At this point some readers groan. Other readers say “Finally!”) Lots of lines in the water is another way to describe a diversified portfolio. Traders targeting one stock are more like fly fishing. One line cast many times, rarely let to set. My style is more like what I did as a kid. Still fishing, setting out a few lines, baited and spread along the shore, then watched from a comfortable spot, waiting for something to bite and get hooked.
Portfolio performance is tossed around as if a 10% increase means each stock went up 10%. A portfolio’s performance is the result of the ups and downs of all of the stocks. Put ten fishing lines in the water and they don’t each catch exactly 1/10 of the total. They each might catch something, but each catch is different and happens at its own time. One line may catch a sturgeon. One a guppy. Hopefully most of them catch enough to keep the angler fed.
My portfolio performance has recently been dismal. The big money has been drawn to the big companies, or has been scared out of the market because of political unrest. Those big stocks have generated the bull market. My stocks are from small or young companies. The stock prices are below my estimated values, which can be depressing, but as my friend pointed out, I have lots of lines in the water. I have a somewhat diversified portfolio. Most of the companies are doing well. Those that aren’t might simply be delayed success stories (MVIS?). Eventually the market recognizes success because any mismatch between price and value becomes more obvious as time and financial reports flow by. I merely have to be patient. If only my bills could be patient too.
Fortunately, one or two of my stocks are hooked to very successful and promising companies (AMSC & DNDN). Those lines have done well and have reasons to do even better. I’ve harvested those catches to pay bills, but also to add to some of the other lines. Harvesting or rebalancing a portfolio becomes like taking some of a catch for dinner, and using some for more bait. It’s been years since I’ve had to buy bait.
The lines I’ve cast are from many aspects of my life: investing, engineering, business, martial arts, teaching, speaking, writing, photography, entrepreneurship, mini-philanthropy, volunteering, and networking. I probably missed a few. Someone told me that I’m living six lives. I believe it. None of it is onerous. I enjoy each of those ventures. I look forward to some of them supplying me with “enough” money, but in the meantime all of them already supply me with a full life.
Like I said in the last post, sometimes I write for myself. This is an internal conversation and review that I have frequently. In many ways I’m busier now than when I was a lead engineer on a major airplane program. Those paychecks were nicer, and I enjoyed the work and the people; but, the culture was personally toxic. That was a pity. That career was also only one line cast in the water. It was a single thread. Now I have lines in the water and when I remember that I feel better. The fishing looks good. I just have to sit back and wait a while.