Do it over, and over, and over, and over, again
The case for consistency.
On August 1st, 2021, the Atlanta Braves sat at 52-54 having just lost to the Milwaukee Brewers 2-1. They sat four games behind the New York Mets and a half of a game behind the Philadelphia Phillies in the division. It was a disappointing start for a team with much preseason hype. Coming into the season, they were viewed as one of the best in the MLB.
They had the fourth best world series odds, 10/1
Tied with the Mets for the best odds to win their division, +155
Were -260 to make the playoffs, an implied probability of 72.2%.
The season was in a state of dismay.
However, after that game something changed. What preceded that day was the Braves would go on to win 16 of their next 18 games. They parlayed this stretch into finishing the season winning 36 of their last 55 games to not only win the division, but win it by 6.5 games. Their playoff chances had dropped all the way down to around 17% and they had the third worst odds in the division at the beginning of August. By the beginning of September, they had flipped their playoff odds to close to 75% and now had the best odds in the division. Quite the turnaround.
They then marched into the playoffs and wound up winning the world series. What a story. A story of consistency. A story of perseverance. A story of outliving the competition.
The best part of the story is they persisted, overcame bad luck when they stumbled out of the gate, and eventually played to their true level. Part of the beauty of the MLB is it has 162 games. That is a lot of baseball. Across a sample size that large, by the end of the season, the cream usually rises to the top. The Braves remained consistent, they showed up everyday, and in the end, they eventually played to their true level and reaped the benefits.
What people fail to realize through this is that consistency is different. It is not everyday that you hear stories like the Braves. It is hard to wake up every morning, roll out of bed, and be consistent. There is a reason why people fail to maintain New Year's resolutions. There is a reason why people fail to keep in touch with each other after college. There is a reason why people fail to keep their financial portfolios in tact. Consistency is that reason. It is difficult, it is repetitive, and it requires courage and resolve. The greatest success stories all have a common theme and it is one of consistency.
Consistency and the Greats
Take Michael Jordan, possibly the greatest basketball player of all time, who was cut from his varsity basketball team as a sophomore in high school. He could have quit but he remained consistent and persisted through the tough times to not only later make varsity but become one of the greatest to ever grace this earth.
Take Kobe Bryant, a five time NBA champion and the 4th all time leading scorer in the history of the NBA, who scored zero points over the course of a summer when he was 11 years old. It wasn’t that he wasn’t playing either, he scored zero points. He talked about this on On Purpose with Jay Shetty and said, “I was terrible. Awful.” When asked how then he became one of the best to ever do it, he preached about consistency. “So I had to look long-term. I had to say, ‘Okay, this year I’m going to get better at this. Next year, that and patiently, I got better and better. It was piece by piece. It was the consistency of the work. The consistency of the work. Monday, get better. Tuesday, get better. Wednesday, get better. You do that over a period of time - three, four, five, six, seven, eight, nine, ten years - you get to where you want to go.”
Progress is a slow build and it is a product of consistency. It does not materialize overnight. It materializes over the course of days, weeks, months, and years. This is applicable to everywhere and not just sports. It can be applied to all facets of life.
Leveraging Time
Take a look at this S&P 500 chart below. Quite ugly, huh? It slowly took the stairs up only to take the elevator straight down.
If you asked someone, would you have invested in the S&P 500 during this time? The answer would be unequivocally, no. A reasonable response. However, what succeeded July of 2009 was one of the greatest bull markets ever and featured 10 straight years of gradual appreciation in which the S&P 500 tripled in value.
There is a very good chance that had you bought in 2008 and 2009, you would have gotten walloped. You would have not made any money and lost a decent chunk had you given up after a year and not continued to invest. This is not a case for dollar cost averaging, rather it is a case for remaining consistent and raising your number of occurrences to eventually reduce the variance and let the odds play out.
Over time, the S&P 500 will appreciate as it has a natural gravitational pull upwards as the economy continues to innovate, expand, and improve and over time, your investments in the S&P 500 will increase in value as a result. This cannot be reached without remaining consistent and reducing variability by allowing more data points or occurrences to come in.
Think of the Braves, they got better as the season went on. The variability of their season grew less and less as more and more games, or occurrences, happened. They eventually played to their true odds, or true level. This is applicable in the investing world. As more trading days tick by, the S&P 500 will eventually revert to its true value and appreciate over time. This applies to more than just the S&P 500. Take TastyLive, a financial network for options and future trading, who preaches the value of at least 200 trades or occurrences when following their trading methods. This all goes back to the notion of consistency and the case for doing it over, and over, and over again. Consistency is king.
Final Thoughts
The Braves would have never won the world series if they had given up. Michael Jordan would have never been one of the greatest to ever do it had he mailed it in his sophomore year when he didn’t make varsity. You would have never made money in the S&P 500, or in options trading, if you would have let one year determine your path.
It is hard to see the value of consistency when you are stuck in the middle of it. No one ever made millions in the stock market with inconsistency. Warren Buffett, quite possibly the greatest investor ever, began investing at 11 and still does at 92, the pinnacle of consistency. If you continue to advance and continue to remain and continue to do it over, and over, and over, again, you too will understand the case for consistency.