Be like captain cool – What you can learn from MS Dhoni

Amar Pandit

Amar is a CFA Charterholder and CFP, having over 20 years of experience in IT and Financial Services. He is very passionate about spreading financial literacy and has authored four bestselling books on Personal Finance.

22 Apr, 2017

One of the most prolific and successful captains of a cricket crazed nation like ours has been M S Dhoni. His demeanour and thinking beyond the next ball strategies have led India to be crowned champions of the ICC World Twenty20 Championship in 2007, the ICC World Cup, 2011 and the ICC Champions Trophy, 2013.

While his persona and strategies have brought much marvel to the entire sporting world, the same can be applied optimally by young investors to pick up a few traits and tricks to help them triumph in the investment game.

Captain Cool

• One of the most characteristic traits of MSD is how calm he remains, even in the most tensile situations. This has awarded him the title of ‘Captain Cool’.  The sheer relaxed aura MS Dhoni emits under the most pressurizing times not only relieves his teammates off any tension, but also assures the fans that when Dhoni is around, the team won’t buckle down without a fight.
• Such a controlled temperament can be a big plus for an investor. Warren Buffett too, vouches for this motto and believes that an investor should never lose his cool, no matter what the situation.
• It’s often common for investors to either leave the market or sell all their equity whenever the market falls. This is natural and follows basic human nature. Instead they must calmly study the deal left in hand and try to raise their stakes and refrain from being either greedy or fearful in their approach. Losing sleep will only give their competitors the chance to get ahead in the game.

Dedicated Persistence

• The decisions a national level team captain makes especially in a country like India, where cricket is considered  to be a religion are of grave importance. They require utmost persistence, especially when being put to test on a cricket field where the game changes with every ball thrown. MS Dhoni has always been an expert in persistence and has led by example, even motivating the younger players to outperform their seniors remarkably.
• Just like cricket the investment market is unpredictable. If an investor puts all his eggs in the equity basket then with fluctuating returns, the investment ride could turn out to be very bumpy. On the other hand, putting them in the debt basket could result in payable interests amounts that would make the ride completely tragic!
• Pulling out investments from one type of market to invest in another, time and again will always bring poorest return on sales and in turn costliest purchase of assets. Thus, an investor must invest time in decision making, picking the right investments, carefully assessing each option like a captain assesses his squad, and then persistently give them ample time to bring returns.

Calculative Thinking

• Dhoni has always been a risk-taker, though he has never done anything reckless or without calculation. For example- He would send a spinner on a well-groomed field or hold back a pace bowler on a rough one. This calculative thinking has always bought success to India and is something that must be practised by investors as well.
• However, investors should take risks only when the odds of profitability over losses are overwhelmingly in their favour. They must closely evaluate the performance of their investments and then plan the purchase or sale. An investor may discard the underperforming options and invest in other stronger performing options after calculating all probabilities.

The Finisher

• MS Dhoni is saluted for his amazing finishing ability to hand India the win. During his innings, one can notice that he starts slow in the beginning, stealing a few singles with rarely any boundaries. Towards the end of the game, Dhoni lets loose and and goes for the big shots to win the match. It is for this reason that he has been sought after as one of the best finishers in cricketing history.
• An investor too must allow his investments to perform normally and then increase the pace. A young investor can take the risk of investing in risky assets like equity, but he must give them time to perform. Also, even if the market tumbles down, his equity basket can flourish with time. Hence investors should play on like Dhoni during the beginning of their innings. Once they start getting closer to retirement they must reduce taking risks and invest in fixed income assets so as to enjoy a comfortable retired living.

Respect your Limitations

• MS Dhoni, though being an impressionable batsman always holds his ground by sticking to what he knows best: Wicket-keeping. He never attempts to push himself up the ladder or pull out a well performing batsman just so he could show off his skills. Such an attitude reveals an impressive trait of his- A man well aware of his limitations, who builds his strengths instead of pushing ahead his weaknesses.
• Investors too should follow this trait by evaluating their strengths and working towards building them. In the words of Warren Buffett, ‘Know and invest within one’s circle of competence’. Investing in sectors where one has no knowledge is just a financial disaster in the making. Too much self-confidence, over estimation, taking investing lightly and doing everything all by yourself, are traits which one should avoid while entering into the investment market.
• Hiring an investment advisor or financial coach is a good idea to help broaden your horizons This is because an investment advisor can do much of the above-mentioned activities for an investor just like a coach does for his team players.