Being a Los Angeles Dodgers fan has taught me the importance of perseverance.
Last summer, my family and I made our first trip to Dodger Stadium where we witnessed Clayton Kershaw’s incredible return to the mound. Months later, as the Dodgers claimed another World Series title, we reminisced about that memorable experience. It reminded me of the joys and challenges of sticking with your team through ups and downs. And, as I thought about it, the more I realized how similar this is to being a lifelong investor.
Becoming A Fan
As we were sitting in the stands, I was happy to see my kids wearing Dodger blue and becoming fans, themselves. This experience caused me to think about how we all become fans of our favorite teams. I don’t remember how I became a Dodger, but I’m glad my kids have inherited this team as their own. Most of us remain fans of the teams we grew up cheering for our entire lives. We cheer for them during the winning years…and the “next year will be our year” years. But win or lose, every upcoming season gives us something to be optimistic about.
Sticking with Your Team
One thing we don’t do as fans is “give up” on our teams and suddenly pick new teams.
The Dodgers’ regular season record since 2010 is 1377-951.1 It has been a good run, with only one losing season over that time. But on a day-to-day basis, that is still a lot of days that ended with losses. Nevertheless, they won the World Series in the COVID shortened 2020 season, as well as the 2024 Series. Those championships were the first ones since winning the World Series in 1988. That was a long championship drought, with a few near-misses along the way. Overall, though, more days ended with victories than defeats.
It never occurred to me to give up on them anywhere along the way. What if, for instance, I decided to jump on the Cubs’ bandwagon after their World Series victory in 2016, or the Royals in 2015? I can’t imagine the regret I’d have felt watching Freddie Freeman hit his iconic 10th inning walk-off home run in Game 1 while I had a Cubs hat on. Ridiculous!
Parallels to Investing
Thinking about my decades long Dodgers loyalty led me to see how being a fan of a team is similar to being a life-long investor. They are both long ‘seasons’. There are up-days and down-days. Sometimes, we feel like switching teams. We enjoy it when our teams outperform, and we tolerate it when our friends are celebrating their teams’ winning seasons. But we always optimistically believe that this will be our year. From 1951-2024, the S&P 500 index of US stocks experienced 53.7% up days and 46.3% down days.2 If those stats were applied to a baseball season, your team would win 53.6% of the time; 86 or 87 games a year. If you are a Cardinals fan, you know you can win a World Series with 83 regular season wins (2006)3 and if you are a Yankee, you know you have won a championship with 87 regular season wins (2000). 4 Teams that win 53.6% of their games are contenders to make the playoffs every year. Most of us would be thrilled with that experience.
Sports fandom and investing require patience and consistency to reap long-term rewards. So, give your kids the gift of fandom, whether for a team or an investment portfolio. Teach them to embrace the journey, ride through the ups and downs, and celebrate the victories. In the end it is about the joy of the ride, and, trust me, it is worth it. Reach out today to see how we can help you build a financial strategy that weathers the ups and downs and sets you up for lasting success. Let’s create a plan that’s worth the ride. At Foster Group, truly caring for our clients means taking the time to learn what’s in their hearts and helping them pursue their goals.
