Long distance running teaches lot about investing

I have enjoyed long-distance running since my childhood and have participated in many such events ever since. During the 400 meter or even lengthier runs, I have realised that I could run the last 100 meter faster than I would otherwise run even in a 100 mt dash.

I used to clock better timing during than the same distance I used to cover in a standalone run. I tried to correct that but recognised that I lack the initial thrust required for a 100-meter sprint.

Recognise your strengths: In investing, despite the various learnings, each one of us would have a style. Over a period of time, notice these patterns and identify your strength.

You could be better at comprehending and analysing at a particular sector or certain businesses. Use this specific knowledge or skill to your advantage and harvest greater results by implementing these techniques.

Identify if you want to sprint or race longer this is akin to trading and investing in stock markets.

In school, I had lanky tall competitors and their stride was always longer than mine. Each time I tried to compete with them, particularly at the beginning of the race, I have exhausted myself quickly and lost out the breath easily. This made it difficult for me to go as per my plan and ended up falling short.

Don't compare with others: It's critical to stick to one's own goals while investing and specially restrict within our risk tolerance.

You may hear your friend or neighbour making better returns in a particular stock or investment. Avoid the herd mentality and cut the unnecessary noise while constantly monitor if the risks involved in the investment diverge from your risk profile.

Such decisions could turn disastrous when the tide turns away. One needs to always stick to their plans and could refine from their experience.

Though, marathon running requires higher strength and stamina the most critical part is the regulation of breath. How one controls and manages to inhale the required oxygen through quicker breaths while continuing to run, would last long and eventually finish the race.

This requires tremendous amount of practice in the techniques of controlled breathing, concentration and conditioning of both mind and body.

Be fit Financially and Psychologically: Investing requires us to grasp our emotions and keep them under control. As the great economist, Keynes once said, markets can remain irrational longer than you can remain solvent.

It's important for one to remain stronger when the going gets tougher and markets tests us with many such instances. One need to be aware of the risks they are entering into and also assess when to walk out to contain further losses.

Diversification thus forms a greatest insurance likewise is the stop-loss levels for stock investing.

Marathon running is not about setting the fastest time but it's about completing the race. You don't race against other but it's mostly about racing against self while timing - better or worse, is just an outcome - a measure of where you stand versus others.

But what if you do not complete the race how does it matter if you had run the fastest one km in between. In tour de France, arguably the greatest and toughest cycling competition, the winner never tops all the stages of this grueling race - it's all about pacing the race.

Survival is important: Investing is also not about finding the next big idea and making money in it. It's not all about identifying the next multi-bagger but also to restrain from making mistakes that could wipe out the capital.

Investing is about understanding the risks and managing them well to sustain through the volatility of the market. In the end, one has to survive to invest the next opportunity. Simply, live today to fight tomorrow.

Would longer hours of training help us to become better athletes? No, there's an optimal amount of training that works for each individual and by greater training does not translate to better results, always.

In fact, most successful marathoners stop doing the entire length run as a preparation at least three weeks into the actual race.

They then concentrate more on the breathing techniques, healthy and balanced diet, building the core, the required muscles and improving concentration.

Lot of work is done on the diet, the warming up of the body and also ensuring sufficient sleep or rest before the race. Avoiding an injury is also important which requires supervised training and following proper techniques.

Portfolio churn would do more harm: Get yourself clear that a greater number of trades don't make for better returns. Behaviour of people at the casino reveal that most turn risk takers when they are losing and turn conservative when they are winning.

This is because, losing hands attempt to cover the losses with the next big win and so increase the stakes. This is a negative spiral and before they realise, end up with bigger losses.

(The author is a co-founder of "Wealocity", a wealth management firm and could be reached at knk@wealocity.com)