Investors Are Like Mountaineers

“It is not the mountain we conquer, but ourselves.” — Edmund Hillary

Investors are like mountaineers. The ambitious ones leave the pack behind and head for the tallest peaks. The higher they climb, the more they have to be prepared for dangerous and unpredictable weather.

A few days ago, I was hiking around a Tyrolean lake. My eyes were scanning the sky. The day had begun dark and cloudy and I had left Mayrhofen hoping for better weather. I was lucky: for a few hours, the air around the lake was clear. But by the time I reached the end of the valley, the wind was picking up.

I watched dark clouds appear above me at the mountain ridge. Next to me, groups of climbers put on their rain capes and wrapped their backpacks in tarps. They proceed up the path with their hiking sticks and heavy weatherproof boots. By comparison, my outfit was that of a casual hiker. I had not prepared for a treacherous climb in the rain. As I looped back around the lake, I felt the first drops on my shoulders.

The experience reminded me of an anecdote from Into Thin Air, Jon Krakauer’s tale of the Mount Everest climbing disaster. Near the peak, Krakauer passed by Martin Adams, a “small, pugnacious Texan” and former bond trader. Krakauer was descending and noticed clouds filling the valleys below. They obscured “all but the highest peaks.” Unfortunately, he didn’t know what to make of his observation.

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