What Marvel’s Doctor Strange can teach us about investing

DISCLAIMER: SPOILER ALERT!

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Marvel’s latest movie to hit the screens feature a high-flying neurosurgeon who meets a tragic and career-ending accident and stumbled into the world of magic and sorcery while scouring for a recovery to his injuries. Upon discovering this new realm, he joins a clan of mystical warriors and sorcerers who are working to defend earth from malicious supernatural entities/beings.

The movie is indeed interesting and it’s filled with superb visual effects and animation, making it feel like a muted-version of Christopher Nolan’s “Inception” mixed with Marvel-style comedy and action (oh and of course with prominent British actor Benedict Cumberbatch as the main lead).

What stood out to me in the show was the scene where Strange first met the Ancient One (aka Sorcerer Supreme) when he entered Kamar-Taj after reaching Kathmandu. Being a high-flying neurosurgeon and spending many years training to be one, Strange was so well-versed in medical and scientific knowledge and technology that he initially could not believe all the acclaimed mystical powers of this secret clan. The Sorcerer Supreme gave him a glimpse of the multi-verses and realms to humble the arrogant neurosurgeon and to make him aware of how much he doesn’t know.

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The Sorcerer Supreme cautioned Strange and told him that he’s “looking at the world through a keyhole”, and that he needs to ironically let go and ‘forget’ what he knows in order to know and understand more. Strange has to get rid of his ego as well in order to broaden his horizon and to learn and absorb more knowledge.

This is similar to what Bruce Lee meant when he said that the master warrior is akin to water, and the only way to do that is to “empty your cup so that it may be filled, become devoid to gain totality.”

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And throughout the film, many other portions of the movie also reminded Strange to let go of his preconceived knowledge and assumptions and to embrace uncertainty and opportunity, and to know how big and infinite the world really is. When Strange finally set aside his ego and got humbled through a painful process of self-discovery, he transcended his prior understanding of knowledge and began to master the power bestowed upon him, and quickly found himself giving his all and defending earth from supernatural foes – becoming a master of magic in the process.

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Aside from the movie and the fictional world of Marvel, I personally found this fascinating, as it relates to being a global macro investor as well.

Due to the infinite possibilities and outcomes and paths that sequences of events could take, our world is highly complex, with the interaction of various variables making it difficult to predict with certainty how things would advance and work out. Our human minds are not geared to understanding non-linear outcomes, and even with delicate mathematical models, they have a probability of breaking down when unexpected outcomes happen within a complex system.

Additionally, each of us comes to the markets with prevailing biases and mental models, and our mode of investing is tainted by the lens we carry. To be successful investors, we need to broaden our horizon and not keep a narrow-minded perspective on things and the complex world we live in. In essence, if we always stick to our own lens of perception, we would be just like Doctor Strange before he discovered Kamar-Taj, stubborn and naive and unable to see the bigger picture and hence unable to transcend one’s own understanding of the world around us. It’s no wonder that ultra-successful people tend to be voracious readers and curious learners – they usually adopt life-long learning habits and study various disciplines.

One great example that I could think of is the legendary value investor Sir John Templeton.

Sir John Templeton was the founder of the Templeton Group and was a well-known and highly successful value investor and philantrophist. His career spanned over more than five decades, investing since the start of the Second World War with his personal savings, across various bull and bear markets and even made a killing when the Tech Bubble imploded at the start of the 21st century. He was a disciplined value investor who scoured the world for bargains and good stocks to invest in.

In “Templeton’s Way With Money“, authors Jonathan Davis and Alastair Nairn wrote about Templeton’s investment rules in one of the book’s chapters, and shared his third rule, which is to ‘Remain Flexible’. Although he was a disciplined value investor with a logical framework, he was not pedantic in execution and was willing to consider any method that might help to identify “bargains”. Templeton shared that investors need to “stay flexible, open-minded, and skeptical”, and “never adopt permanently any type of asset class or any selection method”. Templeton also invested across asset classes other than just equities as long as they were cheap to him.

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In a rather quaint passage in the book, the authors wrote that:

“A former colleague of one of the authors recalls walking into Sir John’s office to find him looking up at the sky, using a comb to guide his line of sight. The colleague knew at once that this had to be another one of what the office openly nicknamed “Sir John’s crazy ideas.” Sure enough, lying on his desk was an open book about sunspots and their impact on stock markets. Most professional investors wold be incredulous that sunspots could be taken seriously as a guide to the behavior of stock markets. Yet Templeton was doing just that. He was genuinely interested in whether a relationship between the incidence of sunspots and stock market movements could be shown to exist. If there was, that did not mean that he thought there was necessarily a causal relationship between the two. It might be that the incidence of sunspots reflected some more subtle, indirect effect, for example through their impact on the weather in crop producing areas. That, in turn, could be an important piece of information when considering the price of agricultural equipment manufacturers…

The point is that he was willing to explore the subject without dismissing it out of hand. He was always asking his colleagues to search for explanations for apparently bizarre phenomena. For his colleagues, such intellectual humility and openness to new idea was striking, given how experienced and successful he had become as an investor…”

It’s indeed interesting to note that such a successful investor like Sir Templeton would do such a thing (it never occurred to me) after already generating superior risk-adjusted returns for himself and his clients over decades.

So before you dismiss information from various perspectives and diverse knowledge paradigms, ask yourself: am I like Doctor Strange when he first stumbled upon Kamar-Taj?

*images taken from various film & entertainment sites*


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