The Indomitable Investor: Why a Few Succeed in the Stock Market When Everyone Else Fails

Ancient Lessons

Most people do not think of themselves as part of the great untidy mass of humanity. They see themselves as rational, smart, discriminating, and more attractive than others. When events prove them wrong, they often do not engage in any meaningful introspection to see why an error was made.

Instead, they blame other people, or blame institutions and say the stock market is rigged. In many ways the market is stacked against outsiders, but the game is not so complicated that it cannot be understood. To say that investing is like war seems melodramatic, but Sun Tzu’s Art of War naturally expresses something all successful investors know, and all failed investors ignore.

If you know the enemy and know yourself, you need not fear the result of a hundred battles. If you know yourself but not the enemy, for every victory gained you will also suffer a great defeat. If you know neither the enemy nor yourself, you will succumb in every battle.43

There must be something to this. Sun Tzu wrote those words more than 2,500 years ago and still they hold true.

If you prefer a more peaceful perspective consider this story about a Western theologian who was an expert in Buddhism. After waiting many years, the theologian was invited to meet a great Buddhist monk at the Drepung Loseling Monastery in Tibet. He traveled from the United States to the hills of Lhasa, where the monastery had been founded in 1416. He was ushered into the great monk’s rooms. He was excited. He could not stop ...