Is Your Portfolio Built for a Sprint or the Long Haul?

Let’s consider the tale of one farmer – for those that haven’t heard of Cliff Young, he was a 61-year-old potato farmer who entered Australia’s 543.7-mile endurance race in 1983. Cliff showed up dressed in overalls and boot, not as a spectator as one might have thought, but rather as a runner competing with racers in their 20’s and 30’s.

Many thought Cliff was crazy and sure enough, as the race began, the pro runners left Cliff in the dust. As Cliff began to make his way through the race, the fans weren’t sure whether to laugh or mourn. As the first of the five day event came to a close, the younger runners bunked down to rest for the evening in order to resume their fast pace the next morning. Unlike the youngsters, Cliff opted out of any rest and decided to run through the night.

As the second night approached, the crowds wondered about Cliff. Still well behind the pace, the question became would he bail out or continue the uphill battle. To their amazement, Cliff claimed his tactic was to run straight through the night with no sleep for the entire 5-day race. He ran at a slow, loping pace, and trailed the pack by a large margin at the end of the first day. While the other competitors stopped to sleep for 6 hours, Cliff Young continued to run. He ran continuously for five days eventually taking the lead during the 2nd night, and finally accomplishing the unthinkable to win the race by nearly 10 hours!

The Sprinter vs. The Farmer – where do you belong?

  • The Sprinter:
    □ When the market is up, you want to beat it
    □ You’re looking at the market results and always concerned you did not do as well
    □ Concentration on certain asset classes does not bother you
    □ Higher results are more important to risk
    □ Having a portion of your assets in low results does not interest you
    □ A balanced portfolio is often not appealing
    □ Quality investing generally does not matter
    □ Short results are often more important than long-term results
  • The Farmer:
    □ Quality matters
    □ Chasing results is not important
    □ The focus is on long portfolio results, not short-term
    □ Risk and recovery matters
    □ Having a portion of your portfolio in low yielding investments does not bother you
    □ A balanced portfolio is preferable over portfolio concentration
    □ Typically avoiding the temptation to chase results
    □ Understands that hot results do not always yield the best results long-term

While the above are the common character traits of a sprinter versus a farmer, it can be difficult to determine which type of portfolio you have. To find out if your portfolio is maximizing its long-term results based on your sprinter or farmer performance, take our quick survey and send it to Linden Thomas, and we will review what type of portfolio you should construct.

To get started, contact us today:

Stephen L. Thomas
Managing Principal
Senior Financial Advisor
Linden Thomas & Company
516 N. Tryon St.
Charlotte, NC 28202

Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. Linden Thomas & Company is a separate entity from WFAFN.