8 Investing Lessons from a Mountain Climbing Trip
Some wisdom from Lake Tahoe
The past week, my colleagues and I went on a camping/hiking trip near Lake Tahoe, California. We camped at Fallen Leaf Campgrounds, and we hiked up Mt Tallac, a mountain at about 3000m elevation, with a hike that is about 10.5km each way in a climb, spanning about 1000m elevation from the campground.
I have done 1000m elevation climbs in the past and I have done 21km hikes in the past, but this was like no other 1000m climb and like no other 21km hike. This was a back breaking climb over extremely rocky path that was very hard, both on the body and on the will power.
Despite my generally regular hiking and not-too-infrequent mountain climbing (having done Mt. Snowdon in Wales and Adam’s Peak in Sri Lanka before), this was way harder than what I had attempted in the past. This hike is very rocky, and unlike my past climbs, which were on levelled paths (even through it might be on steep inclines). Stepping on rocks for extended periods of time can be tough.
Weather got dicey too. What started off as a normal day, got sunnier for a bit, but a few hours in, it got windy, cold and rainy eventually leading up to a hailstorm. I had extra clothing in my backpack, which was duly applied and yet, my hands were numb and swollen from the cold. This trail isn’t for the faint hearted.
Of a group of 12 who started this hike, 10 made it to the top. 2 of us, one of whom is yours truly didn’t make it to - we got very close - about 0.5 km away from the summit, but the last bit wasn’t to be. After 6 hours of hiking up, facing inclement weather, knowing that our path down was going to be as hard and perilous, and at risk of not making it back before sunset, we decided to return not having reached the top. In the end our calculations were right. We barely made it back to our campground at the dying throes of daylight after about 20kms and 11+ hours of hiking.
It was hard and one I am unlikely to repeat anytime soon. However, the hike and the experience were incredible. I thought about some investing lessons from this experience and wanted to share some thoughts here:
1. Metrics can be illusory
The way no two 21 km hikes are the same, and no two 1000m climbs are the same, no single metric (p/s, p/e, p/b etc) is enough to compare different investing opportunities. Strive to learn more about your investments.
2. Different people will go up in different ways, and that’s okay
If you are climbing a mountain, across a large enough group, you are going to find people climbing it at different paces. That’s perfectly fine. Similarly, you need to know that your investing pace doesn’t have to match that of your friend, colleague, sibling, neighbour etc. Pick what works best for you.
3. Find some company at your pace - it will make it enjoyable
After the fastest people broke away from me, I spent a few hours doing this climb alone and while I was determined, loneliness in wilderness can be soul-sapping. Then my colleague Andrew and I found each other somewhere and immediately decided to stick together. What was a tough (and at times miserable) hike alone was made tolerable and dare say enjoyable, by the two of us sticking together and chatting along. In your investment journey, find someone like that and chat with them once in a while. The company & exchanging of notes will make your investment journey enriching.
4. You want to go far and you want to go high, but you don’t have to take the rocky path
In investing and planning for financial independence, the goal is to go high and go far, similar to climbing mountains. However, unlike mountain climbing, where taking a rocky path might be more fulfilling, taking a rockier path in your investing journey adds no value. Find the easy paths to go far and high.
5. Rough weather will come and go, be prepared for it
Like weather on a hike, your investment journey will face some inclement times. Be prepared for it. Like some extra clothing on a hike, invest in some hedges and safe bets along the way. It will pay off when tough times come along.
6. Reaching the summit may be important, but the journey has to be enjoyable
While I would have obviously liked to have reached the summit and claimed some notional bragging rights, it wasn’t as if I was climbing with my eyes closed. Along the way, I saw some spectacular views, touched base with nature, had plenty of time to reflect and had a perfectly memorable day. Our investing journeys are similar. If your target for financial independence is GBP 1M and your journey only takes you as far as GBP 950K, is that a bad deal? Not at all. So long as you enjoyed the ride, and have plenty to take you through your life in a financially safe manner (akin to us reaching camp before dark), you are good.
7. Bears will come and go, but learn to be safe
If you are in a Californian campground, you are told to expect bears. They come looking for your food and they are much stronger and faster than you - so you don’t stand a chance of either fighting or outrunning them. What do you do? You make yourselves big, not turn your back, make plenty of noise, and slowly walk backwards. The bear will go away.
We saw 2 bears and 2 cubs. Watch the video here:
The investing lesson here? Naysayers and detractors will come. Some will be strong and bully you away from your journey. If that happens, make yourselves politely heard and back away from them.
8. Pay your gratitude
This climb was only possible thanks to my lovely colleagues, specifically my manager Zim, who went to great lengths to get us there, keep us comfortable and arrange so much logistics for us. He was sharing something close to his heart and went way above his normal role to make it all work. I am incredibly lucky to have taken part in it. I said my thanks to everyone (Zim and others) who made it possible.
Your lifelong investing journey is going to be similar. Your spouse, friends, family and financial advisors are all supporting you on your way there. Find a minute to thank them, even if it is just silently.