"Good drive… but don't do it too much."
No, I wasn't behind the wheel.
And no, I wasn't at the golf course or the driving range.
We were at barefoot bowls, and I think the greenkeeper was a little concerned it'd go to my head.
I had just – thank you very much – cleared the jack (the little white ball) out from its position close to our competitors' bowls at a work team-building exercise.
Maybe he thought I was grinning a little too widely… or that the success would go to my head.
Now that I think of it, what is the bowls equivalent of Happy Gilmour, anyway?
But I digress.
We all work from home at The Motley Fool in Australia, with a small office on the Gold Coast for meetings and the times when the team up there want to collaborate (or, well, just get out of the house!).
I'm based in Bowral in the NSW Southern Highlands, so it's a bit of a drive for that purpose, but I do enjoy getting to spend time with the team when we organise a get-together.
No, I didn't win bowls. (Our team may or may not have been sabotaged by our competitors, but that's a story for another article.)
But I did have a good time with my smart, fun and hard-working colleagues.
And I got to meet some of our readers and members when we had an informal little meet-and-greet at a local microbrewery the other night.
(Don't worry, I did some work, too!)
"I can't wait to see how you weave bowls into an article", one of our team, Ed, said to me as we wandered off the green to grab a drink (a bowls rule).
We were also reminded to pick up the mat (a bowls rule).
And couldn't sit on the gutter on the edge of the green (a bowls rule).
We also couldn't put the bowls rack – a wooden frame holding our bowls – on the green (yep, you guessed it… another bowls rule).
Who knew bowls had that many rules?
Which is when I knew my answer to Ed's question: the rules of investing and the rules of bowls.
Truth be told, the greenkeeper was cheerful, and the rules weren't inappropriate – they were largely, if not entirely, just to make sure we kept the green in good shape so we wouldn't wreck things for ourselves or others.
Of course it was possible that the mat wasn't going to wreck the green if we left it down for a few minutes. We probably weren't going to spill our drinks. And sitting on the edge of the green was fine, if we were careful.
But, overall, the club reckoned those things were best avoided to minimise the risk and maximise the long term benefit.
And that's kinda where the investing parallel comes in.
Can you use margin loans safely? Sometimes. Most of the time, maybe. But I don't recommend it, because things may not go as well as you expect. Or a lot worse than that.
Can you make money day-trading, or trading CFDs? Yes, it's possible. Just not very likely, so I don't try.
Is it possible to build long term wealth with a few big, risky bets? You bet (sorry!). You can get rich playing lotto, too, but I wouldn't suggest that as a wealth-building strategy, either.
Some people chafe at rules. They hate being told they shouldn't do something.
My 11 year-old is like that. I tell him that perhaps he shouldn't do something, because it's dangerous.
He, of course, does it anyway, then looks me straight in the eye and says "See, Dad… I told you it wasn't dangerous".
Which… isn't quite how probability works.
Russian roulette isn't safe just because the first 'click' reveals an empty chamber…
But hey, if rules aren't your thing, that's cool. Don't call them rules.
See them, instead, as ways to improve your probability of success. Ways to put the odds in your favour and to avoid a big loss or, worse, a total wipe-out.
Then, reorient your investing. Look instead for bets that have a much more profitable likely outcome.
Choose to be diversified, because that meaningfully lowers your risk of going back to square one.
Choose businesses with strong track records and/or profitable business models.
Find companies with long growth runways, at attractive prices.
Use dollar-cost-averaging to smoothe out volatility in your purchase prices.
Keep a long term mindset, so that you don't feel like every investment needs to be a winner every day.
And, if you need to, feel free to drive. Just, as my new friend said, not too often.
Fool on!
