Two Different Approaches

Today’s post is a short one about two videos I saw over the past week.

The first is a video of Dave Portnoy who is the founder of Barstool Sports and an internet personality. Personally, my favorite thing he does is pizza reviews on YouTube, but about two years ago he also started to delve into day trading and began live streaming his trades.

This 2-minute clip chronicles his investing journey beginning from the end of 2019 until this Fall. As a warning, he drops quite a few f-bombs if you’re sensitive to that type of thing:

Dave Portnoy’s “Investing” Journey “Anybody can do this game” — Dave 3/27/2020 🔊sound🤣

The video begins with Dave ecstatic about his success as he starts investing and making some money. Here are a few of his exclamations:

“This is so much better than gambling.”

“Anybody can do this game.”

“I’m a genius.”

“People have been doing this their whole life; I’ve been doing it 10 minutes and I’m doing it better than they could’ve dreamed of.”

And my favorite quote, “Uh oh, Happy learned how to putt” in reference to Happy Gilmore which is just a fantastic line and why he’s a great entertainer.

However, it turns out Dave’s early success may not have been due to his prowess as an investor but rather due to the fact that he began investing during a very fortuitous time for U.S. stocks.

In the year following the decline in the stock market caused by the pandemic in March 2020, 96% of the slightly more than 3,000 stocks in the U.S. had a positive total return over that period. No other one-year period has come close to that since 2004.

Knowing what you were doing wasn’t really a prerequisite to making money in the stock market during that time.

The second half of the video shows where things turned sour for Dave as the S&P 500 dove into a bear market this year and he saw all of his gains evaporate. The quotes change to:

“It’s a blood bath.”

“I’m down half a mil!”

“What’s going on!? I’ve lost my mind…”

“The whole thing makes no sense. We’re living in a Matrix.”

What an emotional rollercoaster. As I was watching the video, I didn’t feel sorry for Dave. He was likely doing all of it for views and clicks more than anything else. My thoughts went to all of the Robinhood traders, with far less money than Dave, who experienced this same rollercoaster trying to pick stocks on a whim and lost a lot of money they could’ve needed.

I contrast that with the second video I saw on Twitter where Justin Tucker, arguably the greatest kicker in NFL history, shared his approach in a postgame interview after he just hit yet another game-winning field goal:

The mental game of placekicking from one of the greatest kickers of all-time, Justin Tucker. #MVPMind

Seeing these videos within a few days of each other, I couldn’t help but notice the stark contrast between the two. As opposed to Dave Portnoy’s emotional-filled, fly-by-the-seat-of-your-pants approach to stock picking, Justin Tucker’s approach to his craft is much more process-oriented:

“I’d be lying to you if I said every time I go out there I’m not a little bit nervous and not thinking about the worst-case scenario. But it’s important to me to focus on the nuts and bolts of what’s going to make the kick. My feelings don’t matter. All we’re thinking about is the things that are going to make the kick and from there, I’m just a system kicker. The ball kicks itself.

All of the feelings and stuff we can enjoy after the fact.”

That sounds like a good way to approach investing. Or any other personal financial decision for that matter. Process over feelings.

By the way, on that game-winning field goal, the ball crossed the uprights with a y-coordinate (width of the field) of 26.52 and the exact middle is 26.67. In other words, if the goalposts were only half a yard wide, the kick still would have been good.

Thanks for reading!