Does the name Jim Thorpe ring any bells? To be completely honest, I had never heard his name before a couple of weeks ago. Jim Thorpe (or rather, James Francis Thorpe) was an American athlete and Olympic gold medalist. In 1912 he become the first Native American to win a gold medal for the United States. Jim was a versatile athlete, completing in pentathlons, decathlons, played professional American football, professional baseball and basketball and there is no doubt that Jim was a natural but his ability to overcome adversity is the story I want to share.
The morning before his appearance in the 1912 Olymipcs Jim realised that someone had stolen his running shoes. Now obviously for a runner having your running shoes is very important. Jim's solution was to run outside to the trash cans where he found two other shoes. Unfortunately for Jim the shoes were different sizes, again not a problem, he put on an extra sock on one foot to even them out. He went on to win two Gold medals.
There are very few things in life that test our patience and perseverance more than investing. When things go well we tend to project that into the future and it all seems so easy and straightforward. But when things turn, and they inevitably do, keeping a level head and rational can become a tough ask.
The past year has delivered an environment which tested the perseverance of even the most seasoned investors. Highlights for me include: when the year started with Ramaphoria on the back of (now President) Cyril Ramaphosa's election as head of the ANC and subsequent ousting of (then President) Jacob Zuma. The Rand continued to fluctuate against major currencies on the back of global investor sentiment towards Emerging Markets. Trade Wars between the U.S. and China continues and it seems that this could continue for a while as neither country is backing down. No real progress has been made on Brexit, one solution now being considered is a second referendum (senseless in my opinion). President Donald Trump continues with his Trumponomics which has driven U.S. growth over the short-term but fears are that the U.S. market is becoming overvalued. And finally as I write this article the Zondo Commission is continuing in full force which I believe to be revelation for the future of this country.
The point I am trying to make is that at the end of every single year we can look back and identify events which either contributed to or detracted from returns. Markets will always fluctuate. This is the normal cycle of markets and it should come as no surprise to any investor, actually the surprise would be if markets stopped behaving like this. But during times when it feels like the market is under-performing and conditions are tough you must persevere and not become emotional in your decision making. The lesson I want you to take away from reading Jim Thorpe's story is that his aim was to compete in the Olympics, the fact that his shoes got stolen did not distract him from this goal nor did this discourage him from participating. It did however require him to adjust his behaviour and persevere because his end goal remained which was to win a gold medal. For investors I believe the same principle applies. Your objective is and will remain to be financially independent. Yes market conditions change and sometimes it is really tough but together we need to remain patient and stick to the plan.
In closing, I want to share the last paragraph of Jannie Mouton's (ex CEO of PSG) Resignation Letter which I found to be truly inspiring and a message I believe we can take into the new year. "Lastly, I continue to believe in South Africa and the many opportunities it presents. We know South Africans are intelligent, resilient, considerate and responsible people and I urge everyone to be positive about the future despite the challenges we are facing. Let us continue to build South Africa and create job opportunities for all!".