Photo: Petar Milošević. Source: Wikimedia
One of my children taught me about “love locks” recently. A couple attaches a padlock to a bridge or a fence or some other public fixture and throws away the key, often into a nearby river. The lock is supposed to symbolize their unbreakable love. I first heard that it was an Italian tradition, but then learned that it’s a global trend. Authorities around the world usually treat the locks as litter and have removed thousands of them from bridges and other structures, noting the corrosion and blight and extra weight they create. In Chicago, workers regularly cut them off drawbridges, because when the bridges move the padlocks are crushed and drop off, becoming a hazard. I’m not sure what to think about the symbolism of lasting love getting crushed by modern life and then become a threat to those nearby, though.
Some imaginative officials regard love locks as tourist attractions and a source of revenue. In Moscow and the UK and Brazil they’ve erected metal trees specifically designed for lovers to attach their fasteners. Enterprising vendors sell heart-shaped padlocks nearby. Sometimes charities use love locks to raise funds.
Lovelocks on the Pont des Arts, Paris. Photo: Disdero. Source: Wikimedia
People like to have keepsakes, memorials of special times and events that have particular meaning for them. It’s why we buy souvenirs and make scrapbooks and collect memorabilia. The keepsake business is a multibillion-dollar industry.
But when it comes to investing, it’s a mistake to let financial assets become keepsakes – assets special to us because of the memories or feelings or imagery they stir. But some corporations do try to encourage us to see them as more than simply investments. Why else would a wedding planning company have the ticker XOXO, or a veterinary care company trade under the symbol WOOF? Sometimes people fall in love with their holdings, putting sentimental value on shares that they purchased or that once provided a solid return or that they received as gifts. This can be a backward-looking rationalization of the endowment effect, where we put extra value on what we currently own.
It’s a mistake, however, to fall in love with anything that doesn’t love us back. Stocks don’t know we own them, and our ownership is really nothing more than entries in a set of electronic ledgers somewhere. Placing personal value on financial assets encourages us to hold onto shares longer than might be good for us.
Love locks are a fun way to symbolize a lasting commitment to another person. When it comes to investing, however, the only thing we should lock onto is our long-term goals.
Douglas R. Tengdin, CFA
Charter Trust Company
“The Best Trust Company in New England”