Rational Advisor

We are irrational in predictable ways

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Mar 25 2008

In the Spirit of Easter

Published by rational at 11:02 am under Uncategorized Edit This

Amazingly it was not just Easter that was celebrated last week

Last week had three other major celebrations for three other religions

Mawlid for Muslims - the celebration of the birth of the prophet Mohammad
Hola for Sikhs - the celebration of their military victories in the struggle for their religion
Holi for Hindus - the festival of colors, a day when all are alike in the different colors and caste and differences are suspended.

And Easter for Christians - the celebration of the sacrifice that Jesus made for the sins of ALL mankind, and his resurrection

For Easter we also celebrate the beginning of spring with the choice of Chocolate and Rabbits

Well, let’s look at some investment themes we can relate to Easter

1. Don’t put all your chocolate eggs in one basket - This is to keep your kid sisters from stealing your eggs - this talks to diversification

2. Don’t eat all of your eggs at once, otherwise you’ll get a stomach ache - plus if you want to be on the good side of your mom, make sure she gets some - SHARE. This talks to not overdoing things, and sharing with the less fortunate (kid sisters)

2. Jesus was condemned and tortured (did anyone see the Passion of the Christ), and many at that time were not favorable for him. Ultimately many turned away from him - much like many are turning away from otherwise sound investments. Preferring to crucify them. Even when you know that they are not the wrong thing. Instead they turn they continue to follow in the way of what is seem as powerful and doing well - much like many continued to follow in the way of the Romans

3. The ultimate resurrection - nobody expected it, but because Jesus continued in his good ways, even though even his own followers forsake him. He eventually was resurrected - hence Easter. So, also will those investments that have not looked hot and the ones that many have forsaken. Because what is honest and true eventually does shine through. However, some investors will have already have thought it was dead and buried.

4. Just like Easter bunnies can only effectively reproduce if they are combined well - i.e. not similar ones. So too with your investments. If your investments are all the same kind (too highly correlated) , it’s pretty hard for them to multiply. They have to be compatible with each other - and then they can breed like rabbits - because you know, it’s spring season and that’s what rabbits do…

Okay, so a lot of this was tongue in cheek. I apologize if I’ve offended anyone, but I think we are all similar, and there’s a lot of good to be learnt from each other. There’s just way too much hate - in fact, we should all celebrate each others festivals

So from Me Happy Easter-Hola-Holi-Mawlid (in alphabetical order, in case anyone got upset about what came first)

Rational

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