Classic Investment Advice

What makes a classic?

Mark Twain called a classic a book everyone wants to have read, and no one wants to read. We remember them from high-school: big, scary tomes with strange titles that our teachers all said were full of wisdom. We tried, really tried, to get through them. Some of us actually did. But whether it was the 25th Ivan Ivanovich in a Tolstoy story, or a sentence in James Joyce’s Ulysses that went on for three pages—I really wanted my 9th-grade English teacher to try diagramming my 12th-grade literature—most of us got lost at some point and gave up.

And yet those works abide. Not because English teachers have a mean streak, but because these books offer insight and wisdom into the human condition: understanding that goes beyond the crisis of the moment; wisdom that goes deeper than shallow truisms. We share a common humanity. Great literature—books and poems that have endured for centuries—express this in a way that comes alive. That’s why Homer and Dante and Shakespeare remain relevant centuries or millennia after their composition.

It’s no surprise that these wonders of the world of words—these classics—have insight for investors. Literature is a reflection on human nature; investing is an exercise in understanding human nature, where the results are written in dollars and cents, not grammar and syntax. By analyzing some great works—beyond the Cliff’s Notes plot summaries—we can gain insight into ourselves, and greater understanding of how investing works—or doesn’t.

Over the next several months, we will look at some of these works—a canon, if you will—and try to distill their lessons—at least the ones that relate to money and investing. And after we have studied these classics, we may even want to read them.

Douglas R. Tengdin, CFA

Chief Investment Officer

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