Effortless

Gary Matthews

Many successful investors who are not professionals seek out a competent financial advisor with whom to work. Together, they work toward the construction and management of a portfolio strategy that will help the investor reach his or her personal goals over time. This accomplished, the conditions have been created so the investor, over the long term, can look forward to a future of more or less steady wealth creation. The advisor helps the investor maintain a steady investment plan, and the investor’s wealth increases, effortlessly.

I say this confidently because the value of a well-constructed portfolio mirrors the broad stock market over time, and the stock market has been rising more or less steadily for the last 120 years. The stock market’s value, in turn, mirrors the value of human economic activity, aka the economy. And it is the nature of our global, capitalist economy to expand. Why? Because the economy represents an aggregate of what the human community does to improve its life. Human beings are continually seeking a better life, for themselves, for their loved ones, for their local communities, and often (not always), for humanity as a whole.

In the last 120 years (at least), the stock market has increased in value because it has reflected humanity’s ongoing quest for a better life. It has done so despite the Spanish Flu, two devastating world wars, and the threat of nuclear catastrophe. There have been down years, of course. The economy has through the years moved in cycles of expansion and contraction, and the market’s shorter term movements tend to be in tandem with those cycles, as well as with the human emotions that accompany them. And yes, some of the contractions, including our current pandemic, have brought about much human suffering. Yet, the long term trend for the economy and the stock market has been steadily UP for more than a century. 

And what of the future? As an investment professional, I am required to remind my clients periodically that past performance is no guarantee of future results. There is always risk with investing, just as we all face risk (so apparent now) in living our lives. I am optimistic, though, about the human spirit and human ingenuity. Humanity has come a long way. Today, despite the contrary and often sensational news headlines that continually bombard us, the human community, globally, lives with greater peace, better health (despite current events), and less overall poverty than at any time in human history (see sources below).

My optimism is tempered, however, but not predominantly by the current pandemic. I am more concerned about the broader (and, I believe, even tougher) human challenge of cleansing our environment and addressing climate change.* This is precisely where SRI investing comes in. Socially responsible impact (SRI) investing recognizes that for investing to continue to be profitable in the long term, the companies and the economy those investments target must move us toward environmental sustainability. The fact that SRI investing is growing much faster today than ever is, I believe, a testament to the human spirit, to its creativity and ingenuity. SRI investors have contributed for decades to an economy in which humanity as a whole continues to thrive and improve. It is doing the same now for our environment.

I’ve been practicing transcendental meditation (TM), more or less continuously, for almost four decades, and during this pandemic, in particular, I’ve practiced daily as advised, twice each day for 20 minutes each. The practice of transcendental meditation is also effortless. The mind, so goes the wisdom, naturally seeks that which is more satisfying. Given the right conditions (steady meditation practice), the mind will naturally quiet down, entering into a state of profound rest, yet remaining awake. Over time, the result is that one’s life becomes more peaceful and joyful.

Successful SRI investing is something like that. Just as the human mind, given the right conditions, settles into a quiet restfulness, a well-constructed, diversified SRI portfolio, given the right conditions, increases in value and contributes to a better world. 

It’s Cinco de Mayo! Stay calm and stay well.