Almost a year ago, we introduced you to the concept of resilience as it applies to investors: The Resilient Investor. Leaving aside the income from work that clouds our perception of success or failure in our financial investments, I would like to emphasise the value of resilience in our investment life itself.
But there is another very interesting concept that we can and should apply to our investment journey, and which will help us improve our success rate over the years. Not only must we learn from our mistakes to turn our losses into investments, but even when the results are acceptable or successful, we must constantly strive for perfection. We can refer to this quest for constant improvement in our investment performance in many ways: the Cluster Effect, Kaizen (Toyota) or more philosophical concepts such as the search for the path or Thu of Zen Buddhism. In any case, this constant effort to improve our analysis and the decisions that affect our wealth throughout our lives will keep us safe from the greater dangers such as euphoria, panic or a lack of humility in the markets and in investing in general.
You can find more information about the app at Kaizen business-related content on the best website for discovering the contrasts, technology and modernity of Japan: Kirai, a geek in Japan. You will also find references to the economy before and after the bursting of the Japanese bubble here y here. I'd like to send our friend a quick hello from here/geek Héctor, whom I had the pleasure of visiting in his beloved Tokyo a few days ago.
The PGR must be constantly reviewed and adapted. At least once a year, we should update it whilst applying something akin to the classic approach to our financial decisions Shewhart cycle (Plan, Do, Check/Study, Act). A form of constant, ongoing quality control that will help us avoid costly decisions regarding our assets over the decades.
It goes without saying that we must adapt all of this to the current economic cycle. But be warned: if we enter a recession, we will have to adapt our protocols, strategies and decisions to a scenario very different from anything any of us has experienced before. The The Great Depression The 1930s are too far back in time, and what’s more, today’s globalisation means that the nature and course of a recession nowadays bear no resemblance to the one our grandparents experienced. However, this globalisation could also exacerbate the effect known in economics as Phoenix, that is to say, rising from the ashes, just as Argentina did and continues to do following its famous ‘corralito’, or Japan, as we can see in this documentary aptly titled Japan: The Phoenix (I recommend at least the first part). In any case, the Kaizen will help us to preserve and grow our wealth throughout our investment journey.