Back to the Basics
On the first Sunday in May, Waitara and I competed in our first horse show of the season at Turner Farm in Great Falls. It rained. It was cold. We had fun, mostly.
Dressage is a bit like portfolio management, part art and part science. You ride a preset pattern and the judge scores you on the execution of the movement, but also on the partnership between horse and rider. Generally, it takes about a year to establish a connection with the horse, and the relationship deepens over time so that the partnership becomes more harmonious as time goes on. Waitara and I have been partners for six years now, and we have a strong bond, but this doesn’t mean that we always see eye to eye on things and she tends to have strong opinions.
On Sunday, we had a decent warm up, she was listening and focused and we were working in harmony, but then everything went sideways when we went down the center line for the first time. We’d lost the harmony. We had different ideas about practically everything. The judge told me to look to our fundamentals.
Portfolios are similar. You can’t just look at one aspect of a security when you decide what to buy or sell because then the portfolio won’t necessarily be a balanced whole. The harmonious way the individual positions work together to build a portfolio is just as important as the fundamental underpinnings.
And just like this quarter, where every holding is being scrutinized for its fundamental soundness and place in the portfolio, I went back to the warm up ring and put the foundation back together. When we went down the center line to start our second test, we were working as a team again, the foundation of technical skills we had spent years honing helped us create a harmonious relationship. We improved on our first test and won second place. It was still raining, but we had tested the foundation, found it was secure and moved forward.
Read more West Financial blogs.»
IMPORTANT DISCLOSURES
West Financial Services, Inc. (“WFS”) offers investment advisory services and is registered with the U.S. Securities and Exchange Commission (“SEC”). SEC registration does not constitute an endorsement of the firm by the SEC nor does it indicate that the firm has attained a particular level of skill or ability. You should carefully read and review all information provided by WFS, including Form ADV Part 1A, Part 2A brochure and all supplements, and Form CRS.
Certain information contained herein was derived from third party sources, as indicated, and has not been independently verified. While the information presented herein is believed to be reliable, no representation or warranty is made concerning the accuracy of any information presented. Where such sources include opinions and projections, such opinions and projections should be ascribed only to the applicable third party source and not to WFS.