Investing Perspectives From Leo Tolstoy

Investing Perspectives From Leo Tolstoy

April 19, 2018

Leo Tolstoy, one of the greatest Russian writers of all time, is no stranger to someone like me who grew up in Eastern Europe. I became immersed in Tolstoy’s novel, Anna Karenina, at a fairly early age.

However, I was surprised to learn about his writings on non-violence that influenced such noted figures as Mahatma Gandhi and Martin Luther King, Jr. and I definitely didn’t expect to hear Tolstoy quoted during a recent yoga class in Boston: “The two most powerful warriors are patience and time.”

I couldn’t help but make a strong connection between that beautiful quote and investing. Patience and time are the two most fundamental rules one learns about investing early on.

When volatility returned to the financial markets in early 2018, we were reminded once more about the importance of maintaining a patient approach to investing. As long-term investors, we need to focus on economic fundamentals and understand that volatile markets may require us to periodically reexamine our financial goals, risk tolerance, and time-horizon.

That said, we should not make drastic changes based on emotions or “gut feelings.” Wise investors know that the key to wealth accumulation is to maintain a long-term perspective and to tune out short-term noise.

One of Warren Buffett’s most famous quotes tells me he may also have read Tolstoy: “The stock market is a device for transferring money from the impatient to the patient.”

Tolstoy and Buffett have that crucial perspective in common and both achieved truly great things in life, which also takes patience and time!