Is investing an art or a science?
Woodcut by Louis John Rhead. Source: Wikepedia
In 1653 Izaak Walton published “The Compleat Angler,” a short book on fishing. In this little treatise he compares angling to mathematics – something that can never be fully learned. There’s always a new approach or a new location or some novel piece of equipment. “But he that hopes to be a good angler,” Walton continues, “must not only bring an inquiring, searching, observing wit, but he must bring a large measure of hope and patience.” He describes fishing as the perfect combination of contemplation and action.
It’s the same with investing. Investors need inquiring minds, hopeful dispositions, and patience. It can take some time for an investment approach to work out. At the same time, we have to be diligent to make sure that the main idea behind our investment thesis hasn’t changed. We can’t afford to be whipsawed by every new fad or fashion that appears—but we can’t ignore how things change over time.
Good investing is both art and science. It’s a science as it applies to investments, but an art as applied to the investor. Each investor is unique, with unique objectives and limitations. Applying the right investment in the right circumstance at the right time is something that—as Walton would say—is satisfying in the result, but also in its application. Investing, like fishing, is a reward to itself.
Douglas R. Tengdin, CFA
Chief Investment Officer