The Daily Dow
Monday, August 25, 1997
by Robert Sheard
LEXINGTON, KY. (Aug. 25, 1997) -- I am ever seeing parallels between the marvelous game of golf and Foolish investing. This weekend, while watching the final match of the 97th U.S. Amateur Championship, I was struck once more by the similarities.
The U.S. Amateur is a grueling tournament, a combination of two qualifying rounds of stroke play, followed by a single-elimination match-play tournament for the top 64 players. By the end of Sunday's final match, the two finalists will have played nine pressure-packed competitive rounds in seven days, something the pro tour doesn't even do any longer.
What struck me especially, however, was the situation in Sunday's final match, a 36-hole affair between heavy favorite Joel Kribel, a 20-year-old Stanford University junior, and a relatively unknown Georgia Tech sophomore, 19-year-old Matt Kuchar. In the morning round, Kuchar built a three-hole lead, to which he quickly added on the front nine of the afternoon round. By the time the players got to the back nine in the afternoon, Kribel was in a deep hole and Kuchar looked invincible.
But then fortune changed and the real test for Kuchar began. Over a short stretch of holes, Kuchar saw his seven-hole lead trimmed quickly to five, then four, then three. And finally, with three holes to play, Kuchar's lead was reduced to a nerve-wracking two shots.
It was during this stretch that I saw Foolish parallels between golf and investing. When Joel Kribel starting pouring birdies in and winning almost every hole, Kuchar, while visibly nervous, didn't change his approach to the match or the course. He played the same way on the back nine that he had played on the previous 27 holes -- shooting for fairways and greens and taking his chances on birdies with his putter. When Kribel dropped a birdie putt, Kuchar stuck to his strategy. When Kuchar missed a green and lost the hole with a bogey, he didn't panic; he didn't try to change a plan he knew would work for his game. In other words, he let things take their course, confident that he was doing the right thing for the long run rather than for any one particular hole.
By not giving up on a winning approach, time came to Kuchar's side and Joel Kribel ran out of holes before he could finish a brilliant comeback attempt. Kuchar, much to many viewers' surprise, won the match two holes up with one to go and proved that even the unknown player (the individual investor of this comparison) can overcome the conventional wisdom if he uses a sound strategy and sticks with it for the long haul. Sometimes the 30-foot putts drop, sometimes they don't. But a tap-in for par is a lot better than trying glory shots from the parking lot. And so are steady returns with the boring Dow approach than the occasional terrific performance on a flashy "hot" stock.
Pick a strategy that can work for you. Don't listen to the conventional wisdom that says you can't possibly win. Stick to your approach through good and bad times. Above all, believe in yourself and don't panic. Congratulations Matt and Joel -- a terrific tournament! Fool on!
(c) Copyright 1997, The Motley Fool. All rights reserved. This material is for personal use only. Republication and redissemination, including posting to news groups, is expressly prohibited without the prior written consent of The Motley Fool. ________________________________
Stock Change Last -------------------- T --- 40.25 GM +1 1/2 66.25 CHV - 7/8 78.56 MMM + 1/16 92.69
Day Month Year
FOOL-4 +0.26% 4.41% 10.58%
DJIA -0.32% -4.42% 21.89%
S&P 500 -0.37% -3.58% 24.22%
NASDAQ +0.18% 0.49% 24.05%
Rec'd # Security In At Now Change
1/2/97 153 Chevron 65.00 78.56 20.87%
1/2/97 179 Gen. Motor 55.75 66.25 18.83%
1/2/97 120 3M 83.00 92.69 11.67%
1/2/97 479 AT&T 41.75 40.25 -3.59%
Rec'd # Security In At Value Change
1/2/97 153 Chevron 9945.00 12020.06 $2075.06
1/2/97 179 Gen. Motor 9979.25 11858.75 $1879.50
1/2/97 120 3M 9960.00 11122.50 $1162.50
1/2/97 479 AT&T 19998.25 19279.75 -$718.50
CASH $1009.44
TOTAL $55290.50