A relative of mine had an interesting quirk with regards to his type of carb intake for lunch and dinner, which goes like this: if I had rice for lunch, I would have noodles for dinner, and vice versa. At first look, it is a simple guideline to live by, until one day when we went for an overseas trip, and that was when we realised the guideline was more than that.
Long story short, he had noodles for lunch, hence when dinner time came, the location at where we were happened to be dominated by noodle shops. My relative insisted on having a rice meal for dinner, but we could not find any, at least at our immediate location. After walking for a couple of streets, we chanced upon a place selling baked rice and he finally ate at it, after a round of raving and ranting of not able to find a rice outlet.
What I had initially thought was a simple guideline turned out to be my relative’s dogma, i.e., “I cannot have two rice/noodle meals a day! I need to stick to my arrangement!”. Although this could be a frustrative experience for all parties concerned, such things are commonplace in our everyday lives. I believe you would have encountered situations of your family members/friends/acquaintances/colleagues of preferring, very strongly, a certain item/course of action/decision making basis, even though it might seem trivial at first glance, and there is not really much loss or opportunity cost in foregoing that preference.
It is hard to blame those who are insistent on these so-called trivialities. Everyone is born different, and this includes our personalities and characteristics, from which our attitudes to and perceptions of the world are dissimilar. While I acknowledge and agree on this, it is equally important that the person admits that he/she possesses these traits in them. Once these are admitted, then half the battle is won in recognising his/her own strengths and (especially) weaknesses.
A Contradicting World
Humans are adaptive creatures, so to speak, else we would not have been progressing this far in evolution and our existence on this planet. Being adaptive also meant that we are also flexible by nature. Yet, nestled among this adaption and flexibility are countless instances of adherence to doctrines which may not make sense. This is the contradicting world that we are living in.
However, we still need to have doctrines, and be adaptive and flexible at the same time. It is a fine balance between these two extremes. Too much flexibility would result in being frivolous, while too many doctrines would make one labelled as dogmatic. Again, how much balance is dependent on the very core of an individual, i.e., the personality and character.
Application On Investment
Applying the above to the realm of investment, it is a given that each one of us will have different investment philosophies, methodologies, styles and portfolios. Hence, in my blog posts and eBook, I have guidelines in place for certain issues, e.g., selection of securities and the make-up of portfolio, as I accept and encourage these differences. However, simultaneously I also promote a dogmatic approach on aspects like diversification and rebalancing, because of my conviction in them. This is a case where I am balancing the adaptive/flexibility and doctrinal spectrum in my investment philosophy. Sounds ironic, but we are humans after all.