In the investing world as elsewhere, we face the all-too-human tendency to jump to immediate conclusions, to accept conventional wisdom too eagerly and to fall prey to hyperbolic discounting – valuing now too highly and not yet not enough. But as I often say, hope is not a strategy and lunch is not a long-range plan. This problem was illustrated in a fantastically funny way recently by Super Bowl winning quarterback Russell Wilson of the Seattle Seahawks on Twitter.
You see, Bleacher Report gave the 2012 Seattle draft an “F” as the worst of any NFL team and called Seattle’s third round selection of Wilson “by far the worst move of the day.”
Ouch (even though, to be fair, the NFL Draft is really hard to get right). And Bleacher Report was hardly alone.
But by any measure, the 2012 NFL Draft was an enormous success for Seattle. They got their franchise quarterback (and got him cheaply, allowing for much more roster depth and flexibility), three other starters and two more contributors. Six contributors including four starters is a great draft haul for any team (even without a franchise QB being part of the equation), much less one good enough to dominate the Super Bowl.
Good investing – like good decision-making generally – requires patience, a willingness to go-against-the-grain and an independent mindset. You’ll never get ahead of the pack by doing what everybody else does. Much about our business and our make-up seems to demand instant results and instant evaluation. In this instance at least, the trend is not your friend.