Checking the Boxes

Are you just going through the motions?

Source: adaptibar

Sometimes low-tech innovations can improve high-tech outcomes. Such is the case with the humble checklist. Checklists have been used for a long time in aviation and project management, helping people organize complex processes and avoid forgetting essential items. Lately they’ve made their way into hospital operating rooms, where they’ve helped cut the rate of complications by over 30%.

They help investors as well. When we look at potential investments, there are a host of factors to evaluate, from cash flow to management to liquidity. Investing is a multifaceted process, and checklists help organize it.

But there’s a danger in using checklists. Going down the list can degenerate into going through the motions—asking a question just because it’s on the sheet, not because we care about the answer. When I was a student-pilot I learned to do a “walk-around” pre-flight exam. It mattered how the aircraft looked; I was putting my life into that airframe. You can bet I made sure there was oil in the engine and no water in the gasoline.

In the same way we need to bring passion into the process of portfolio management. It’s a paradox, but we have to care about our investments, even as we’re cold and calculating. A stock doesn’t know you own it, but you need to know that you own the stock.

Einstein claimed he had no special talent, only passionate curiosity. We need to harness our passions, even as we check off the boxes.


Douglas R. Tengdin, CFA
Chief Investment Officer
Phone: 603-224-1350
Leave a comment if you have any questions—I read them all!

Follow me on Twitter @GlobalMarketUpd

www.chartertrust.com • www.moneybasicsradio.com www.globalmarketupdate.net
By | 2017-07-17T12:23:14+00:00 November 7th, 2014|Global Market Update, Uncategorized|0 Comments

About the Author:

Mr. Tengdin is the Chief Investment Officer at Charter Trust Company and author of “The Global Market Update”. The audio version of each post can be heard on radio stations throughout New England every weekday. Mr. Tengdin graduated from Dartmouth College, Magna Cum Laude. He received his Master of Arts from Trinity Divinity School, Magna Cum Laude and received his Chartered Financial Analyst (CFA) designation in 1992. Mr. Tengdin has been managing investment portfolios for over 30 years, working for Bank of Boston, State Street Global Advisors, Citibank – Tunisia, and Banknorth Group. Throughout his career, Mr. Tengdin has emphasized helping clients manage their financial risks in difficult environments where they can profit from investing in diverse assets in diverse settings. - Leave a comment if you have any questions—I read them all! - And Follow me on Twitter @GlobalMarketUpd

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