The Schedule of the Investor

Here is a first post that goes into the general thinking pile, this one related to investing. On the highest level I would look into the game of investment in two main areas:

1. Investment process
   • Decision making process 
   • The schedule of the investor
2. Investment strategy and it´s implementation
   • Philosophy (e.g. value investment), temperament and area of competence/focus etc.

Today I will think a bit on how to best allocate time as an investor.

The schedule of the investor

How we spend our days is, of course, how we spend our lives. What we do with this hour, and that one, is what we are doing. A schedule defends from chaos and whim. It is a net for catching days. It is a scaffolding on which a worker can stand and labor with both hands at sections of time

The business of investing is a highly competitive game - to be successful you need to find an edge. I suspect the most underestimated area of the investment strategy is an investors allocation of his time, the daily schedule. 

If you think high level what your investment process, or allocation of time, should produce it would be something like the following:

1. Better ideas 
2. Less errors and mistakes 
3. Continuous learning of your investments and watch-list
4. Continuous improvement as an investor

To generate this my proxy of a optimal investor schedule would be somethings as below:

Optimal schedule

#	Activity	Time spent	Comment
1	Searching for new ideas	~45%	1125 hours a year sifting through the world of investments
2	General learning	~30%	750 hours a year to study your decision making & mistakes, read books, discuss with smart people, study extreme successes & failures etc.
3	Deepening your understanding of watchlist and current investments	~20%	500 hours a year deepening your understanding of current investments and your watchlist
4	Investment decisions	5%	Up to 125 hours a year on 2-4 decisions. I.e. documenting decision and go through check-list to avoid errors

In above, I would try gear as much time as possible in durable information to make the learnings compound. You would not like spend your time predicting things irrelevant to your investment case (e.g. next FED decision or even next quarter result) as the insight gained is worthless as time passes. In companies, focus on the big picture - structural factors of the industry, management and the moat and in general learnings focus on knowledge that will be true 50 years from now. 

Inversion

If you would invert the optimal schedule I would put it something like below:

• Spend as much time as possible looking at the stock screen and your stock account for today's developments
• Forget the big picture, focus on the drivers that will move the stock this week and next quarter, especially FEDs interest rate decision
• Only follow 10 companies 
• Of course the huge mispriced bets will turn up in those companies
• Do not spend any time in deep thought, be in an environment of disruptions and energy. The dream would be to have the desk at the noisy NYSE trading floor. Multi-task a lot for efficiency - Charlie Munger clearly got it wrong on this one

• • "I think people who multitask pay a huge price. They think they’re being extra productive, and I think when you multitask so much you don’t have time to think about anything deeply, you are giving the world an advantage you shouldn’t do, and practically everybody is drifting into that mistake. Concentrating hard on something that’s important, I can’t succeed at all without doing it. I did not succeed in life by intelligence. I succeeded because I have a long attention span"

• Mindlessly surf the internet

On the topic - the schedule of this random hedgefund manager is clearly interesting with Warren Buffet as reference.

Although I am not full time, how do I spend my time as an investor? I for sure spend too much time checking the stock account, mindlessly reading blogs, twitter or news.  

/RQ