Bali Reflections Part 1: Getting a Coach
We just came back from our annual company retreat at Bali, Indonesia.
Now, I am not sure how other companies do their retreat but for us, it was more like an adventure camp. We scaled a volcano, trekked to a waterfall, learn how to surf and we played mind games when “resting” at the villa (more about that in future posts).
While it sound tiring, I actually like this kind of retreat. It put us through some hardship to bond us together, just like how we used to do it in the military.
There were many reflective moments during the retreat and I want to pen them down so that I can reflect upon them further.
Voices give Inspiration, Words give Clarity.
Surfing is definitely a must do in Bali. There is no age limit and you don’t even need to bring any equipment. You just need to know how to swim.
When we were at the beach, we were looking around to rent surfboards. Frankly, being the value investors we are, we simply went for the cheapest possible. As we were renting the surfboards, the vendor offered us their coaching programme too.
However, when I looked around the beach, many adults were surfing by themselves and young children were coached by their own parents. So we opt out of the coaching programme and proceeded to surf on our own.
My method to pick up surfing was quite simple. It was mimicry, or in plain English, Copy the Others. I observed how others were doing it and proceeded to attempt surfing on my own.
The first few surfs were bad as expected. The surfboard was flipped over and I was having a hard time to stand up on the surfboard, let alone riding the wave.
After a few mouthful of seawater, I paused to observe again. This time, I looked for other surfers to see if they have better techniques to copy from. After purging the seawater from all my bodily orifices, I was feeling confident again. I bravely dived into the sea and surf again.
This time, it was worse. The waves got bigger and I was having a hard time. Pushing the surfboard out into the sea was almost impossible with huge waves crashing against me. I finally gave up when my surfboard smacked right into my face, momentarily knocking me out. Fortunately, it was only a split second before I regained conscious and braced myself again as the next wave was coming again.
This was when the coaching programme came to mind, and I realised how silly I was. I should have taken the coaching programme from the beginning! It would have saved me so much time, and more importantly it would have kept me away from all these dangers of surfing.
With my ego slightly bruised, I went to the vendor to get a coach. My coach was Rais (honestly, I can’t remember if that was his name because my ears were filled with water when he introduced himself)
Rais was not just any surfer, he was in fact the “boss”. The other coaches were his students. He was ripped and tanned, sporting a surfing short (while I was in my beach shorts).
He first asked me how I was surfing and had me demonstrated for him. As expected, I crashed from the waves within seconds.
Immediately, Rais asked me to stop and corrected my surfing. And one thing he said particularly struck me, “Woah, you are very brave but dangerous.”
He pointed out that I was doing very dangerous moves, which I had no idea was dangerous? I was merely copying other surfers. Rais laughed, “For pro surfers, this is skill, you are just crazy.”
Rais told me to forget about everything I have “learned” so far and he taught me the basics again. “Place your foot here, grab the board there, squat lower, learn backward further”
All his advices seem very simple and almost useless. But damn it was effective. Just after a few tries, I was able to stand up on my surfboard! Then he started to teach me other stunts once I am able to ride the wave properly and safely.
At the end of the coaching session, I asked him, “So what was my problem?”
He smiled and said, “You too tall! But you surf like short people.”
Ha! So that was my problem! We both had a good laugh and took a picture before we parted ways.
So What Are The Lessons?
Alright, if you are still reading this, I hope that you are not just gloating at my stupidity but picking up lessons learnt along the way. And yes, no prizes for guessing the topic of my reflections, it is still back to investing.
Many of us approach investing like how I approach surfing. We believe that we should be able to do it on our own, simply because many others are doing it. And often, the way we start investing is by mimicry – copying others.
Of course, there is nothing wrong copying others, especially if these people are successful in their investments. However, there is an inherent flaw to copying others from afar. You cannot mimic their actions perfectly and more importantly you will not be able to understand their reasons or context for investing in a particular way. Often, what you cannot see or observe are the most important parts.
Just like I was trying to learn surfing by observing others. While I could see their apparent actions, there was no way I could “observe” the smallest and subtle moves. And that made all the difference.
Without context, I was actually copying the wrong surfing actions. A taller person surfs differently from a shorter person.
Investing is similar to surfing. No one has the same investment strategy. While your height probably has nothing to do with your investments, everyone invests differently because the personalities are different. What makes a good and effective investment for you may not make a good investment for someone else. Many factors come into play such as your risk profile, investment objectives, capital size, cashflow requirement etc.
Therefore, many of students often asked me, “Why doesn’t it work when I copy XXX’s investment?”, and my reply is always “Because you only copy from XXX and did not truly learn from XXX.”
Without the proper coaching, many investors had moments of “surfboard hitting their faces” in the stock market. Investing at the wrong stock, wrong time with the wrong strategy. Losing huge sums of money in the process. Mistakes are often more costly than school fees. I have learned to pay up fast before I dive into any investments.
However, surfing the stock market need not be such a devastating experience. The key is to finding a good coach. I think Rais sets very good example for us.
How to find a Good Coach?
Find someone with experience and most importantly, is still practising the craft
When I first saw Rais, his movements in the water clearly showed that he is experienced in surfing and all the abrasion marks on his legs clearly indicates that he still surfs regularly. I felt safe and assured getting Rais as my coach because I know he still practised his craft. He was continuously honing his skill, and if I learned him, my surfing skill would continue to improve too.
So if you finding someone to learn investing from, please find out if he or she is actually investing themselves. I have heard of bank relationship managers giving out recommendation on investments while they do not invest at all. Yucks. Talk about having no skin in the game.
Don’t just copy the good coach, learn by getting closer
Frankly, I did see Rais in the water before I took on the coaching programme. He WAS one of those I tried to copy from. Yet, I still crashed into the waves after copying him. However, after I got 1 on 1 coaching with him, things changed. I managed to surf properly and soon we were doing stunts.
The question is, “Did Rais change his surfing style when he was coaching me?” “How could my results from 1 on 1 be so different from copying him?”.
No, Rais was surfing exactly the same way. The main difference was this time I am being coached by him, instead of copying him from afar. During the 1 on 1 coaching, he adjusted his teachings to my exact needs and it greatly enhanced my learning. There was no more trial and error copying, these were all instructions specifically tailored to me.
This is very important when it comes to investment coaching too. Your coach needs to be able to understand what is your situation and what are your personalities before coaching you how to invest. The best investment strategy is not necessarily the most profitable one, but it has to be a strategy that you can execute and sustain for a long time.
Find a coach who is very selective, and does not rush the process
One key learning from Rais is “This wave not good”. Rais is very picky about selecting the best wave to surf. He understands that it takes me a lot of effort to bring the surfboard out into the sea so he must make every surf counts. He also understands that every time that I fall off from the board, I will be more discouraged. Therefore, he only chooses the best wave for me to surf, maximising my chances of success and pushing me to try again.
In fact, there were many times when I felt that an approaching wave was good and I was eager to surf it. But he would hold on to my surfboard firmly and stopped me. After which, I would watch in horror as other surfers crash and burn trying to surf that very same wave, knowing that it could have been me if not for Rais.
I asked Rais how he knew which is a good wave or not? He pointed at his legs and said “Tried before”. A good coach is someone who can translate his past experience into learning lessons for you and prevent you from making the same mistake.
Surfing the stock market is no different, not every stock is a good stock. You don’t need to invest in every stock you come across. Instead you should be very picky about which stock to invest, and a good coach will make a lot of difference here. I can’t share the exact details but there were so many incidents where my students were on the verge of making bad investments before me and my team of coaches came in to intervene. So if you are going to make a big investment, please first consult your coach. It could save you thousands and sometimes hundreds of thousands dollars
Always Go for Paid Coaching
Although I am a coach myself, I was trying to save on coaching fees. Instead of paying for the vendor’s coaching, I went to do my own DIY free coaching. I ended up crashing into the waves, swallowing mouth after mouth of seawater, bruising my knees, and still not able to surf in the end. However, after under Rais’ coaching, my learning accelerated and I was able to surf within minutes. In addition, it was a much safer and smoother experience than my own DIY coaching. If I were to do it again, I would go for paid coaching anytime.
Good coaches are usually high in demand. While I don’t use the price to judge if they are good or bad, I know a free coach is seldom good. Because it is free, meaning it is NOT in demand.
In the world of investing, I also witnessed a lot of DIY investors. While some make it, most of them don’t. Yes, they may have saved on coaching fees, but they ended up paying much more in investment losses.
My own rule for getting a coach is “10%”. This means, if I am investing 1 million in something, I am willing to pay up to 10% in coaching fees ($100,000) to make sure I am doing it correctly. Mistakes are often more costly than coaching fee, and mistakes comes with an emotional cost too. I have met ex-investors who have been burned once that they swore off investing totally, no matter how good the investment opportunity may be. The fear of losing have made them irrational.
Build a long term relationship with your coach
While Rais was paid for one session of coaching, I was committed to becoming friends with him and develop a long term relationship. Why? Because I believe it will be invaluable to have him in my network if I want to surf again.
While I learned how to surf during this trip, to becoming good at surfing will definitely take more than one coaching session. I know that I can learn more from him and more importantly he probably know other surfers who are even better and stronger whom I can learn from too. I have had many coaches in my life. I have always tried to build long term relationships with them because the investment world is as vast as the surfing seas. Stocks and options are just one area of investments.
If I truly want to get better at my investing game, I need to meet more coaches, and there is no better way than an introduction from another coach. A warm introduction always beat a cold meet up at networking session. Being introduced by a trusted source will speed up the awkward “knowing each other” phase. Also, I can trust that this new person will be reliable because my own coach trusted him or her too. Lastly, we must also understand that success takes time so you want a coach for at least a few years.
As we were parting ways, Rais and I exchanged numbers and snapped a photo together. I told him that I will be back in March, and he said, “Call me, I bring you to good waves”.
To many more good waves, both in the seas and the stock market!
