No Man is an Island..

Many of us invest in capital market and each of us may follow different investment strategies. Some of us are long term investors and some are short term traders. But these are not discrete choices but two extremes of a continuum. Therefore most of us, on the basis of our risk aptitude, will lie somewhere in between. Whatever be our investment profile our primary reason for our investments is return.

When we invest, we carry out lot of research, fundamental or technical, friendly tips or even ‘insider news’, to maximize our return. Whatever type and extent of research we carry out, we know that all our investments will not give us positive return all the time. If we are good and/ or lucky a large chunk of assets in our portfolio will give us positive returns often enough or some of them will give us extraordinary return occasionally. It is this uncertainty that we try to address when we acquire a diversified portfolio of assets, which on aggregate has a higher probability for offering positive returns.

Some people don’t have the stomach to take this uncertainty and therefore they keep away from the world of investment. When they consciously keep away from the risk they also give away the potential return associated with it. There is no asset that can give total guarantee of return all the time and risk goes hand in hand with any asset.

In the same way our circle of friends or our network of contacts can also be seen as a portfolio of assets. Some of them are worth long-term investment some are worth short term; but, it definitely makes sense to have a diversified portfolio to be built and nurtured.

One may say that this is a very materialistic way of looking at relationships. It will be so only if we define returns in absolute material form. If we include everything that a friendship brings, whether material or spiritual or emotional or just plain cherishing of companionship into the ambit of our model, then this model is a good way to understand and appreciate our portfolio of friends and contacts.

We can seldom get friends or business partners who will always match with our thinking, preferences, beliefs or whims and fancies. There are times some of them will ‘let us down’ beyond our imagination.

What is our response to this? Do we take a position that ‘we cannot trust anybody’ and keep away from relationships as much as possible? If we do so, we will be losers. We miss the opportunity to experience and cherish a variety of wonderful people who may sometime share happiness, sadness and prosperity with us.

Sometimes we overreact to some incidences in which a person has behaved in an unfair/ unethical / disloyal fashion. Do we jump to conclusions on the basis of one/ few incidence (s)? If we do, it may not be a good idea or may not be fair. One missed dividend or one bad quarter cannot be a good enough reason to dump an asset.

It is the reality of life that we need to have a diversified portfolio, whether it is of people or whether it is of material possession. We need to develop a sensitiveness to judge the kind of assets we are comfortable with and what kind of portfolio we need to keep for different proposes; as friends to share our happiness and sorrow and as partners in our professional dealing to strengthen our collective offering.

One of the most critical qualities of people who make things happen and / or is at peace with themselves is their ability to nurture a strong portfolio of friends / contacts (the ‘end’ each of them seek is different; but. there is a commonality in ‘means’ from this point of view). Politically savvy may even have large ‘trading portfolio’ too (a portfolio they churn and trade :-) ).

We need to accept that at best we can expect 80% co-operation from 80% friends at any time. This is only 64% co-operation on a steady state, which is just more than half the time. We need to learn to build on this to go forward. Especially if we are involved in public service, then our skill in identifying areas of common interest with a wide cross section of people becomes a key determinant of success.

I agree, like in capital market, there may be some assets which may be better to shun. But mind you they are a minority, and often contextual and if you are smart and or lucky even they pay a dividend sometimes which may at worst a ‘lesson for life’

“No man is an island, entire of itself; every man is a piece of the continent, a part of the main; if a clod be washed away by the sea, Europe is the less......” John Donne, 1620