Two Monks and One Big Lesson in Life and Investing

Two Buddhist monks, a senior and a junior, were walking through the forest. They came across a river flowing through their path. To continue their journey, they had to swim through the river and cross to the other side.

There was a woman who was sitting at the bank of the river. She did not know how to swim and requested the monks to carry her to the other side.

Buddhist monks take a vow of celibacy. They are not supposed to even look at women, let alone carry them. The junior monk politely refused. But the senior monk put the woman on his back, swam across the river, and dropped her safely to the other side – without saying a word.

Image Source: Isha
The junior monk was aghast that the older monk had broken his vow but did not say anything. An hour passed as they traveled on. Then two hours. Then three. Finally, the agitated junior monk could stand it no longer, and asked, “Why did you carry that woman when we took a vow as monks not to touch women?”

The senior monk smiled, and said, “Brother, I dropped the woman on the bank of the river a long time ago. However, it seems that you are still carrying her around in your head.”

I had read this story a long time back but remembered it while recently dwelling on my past in a way that was starting to interfere with my present life. But once I revisited this story – or the story revisited me – there was a change in my perspective. My mind fog cleared, and I could see things in a better light.

We all go through times in life that lead us to hold onto things better left “on the other side of the river” and yet we continue to carry them in our minds and continue to hurt ourselves. We choose to ruminate over past actions or events, even when it ultimately weighs us down and saps our energy.

Consider investing. Not accepting your mistake to avoid looking like a fool, and thus holding on to bad businesses is a behaviour exactly like what the above story conveys. You carry baggage – a bad business in this case – from the past that you know is not worth carrying, but you continue to do that for reasons like – “I won’t sell before I get my money back,” or “Selling now is like accepting a mistake, which won’t look good on my investment track record.”

This is what behaviour scientists call loss aversion and regret aversion – our attempt to avert losses and regrets in the future, because we do not drive pleasure from them. So, these cause us to carry that baggage from the past.

Sunk cost fallacy is also at play here. We avoid changing our original decisions just because we have spent too much time, money, or energy into them. Remember that a sunk cost is nothing but a baggage and must be dropped if you realize it is not worth carrying.

The reality is that that bad business you are holding on to, even when it becomes a small part of your portfolio, will continue to occupy a large part of your mind. It will continue to remind you of what could have been, or how you were such a fool to make such a bad decision. I have been through this, and so I am talking purely from personal experience.

Look at this beautiful illustration from Tim Urban of Wait But Why –

Image Source: Wait But Why
If you allow the past – in investing or out of it – to consume you, you will never create the future you want and deserve.

Learn from cars that have large windshields but small rear-view mirrors, because while driving you must look ahead most of the time and look behind only occasionally.

Life is designed like that too. Drop the baggage from the past – loss, guilt, sunk cost, regret, expectation not met – and stop looking at the door that closed behind. Instead, shrug yourself and step through the door in front.

Like the senior monk, let go of the past with its baggage. Leave what is not worth holding on to. Press forward.

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P.S. One of my favourite texts on letting go of the past is a Hindi poem by Dr. Harivansh Rai Bachchan –

जो बीत गई सो बात गई
जीवन में एक सितारा था
माना वह बेहद प्यारा था
वह डूब गया तो डूब गया
अम्बर के आनन को देखो
कितने इसके तारे टूटे
कितने इसके प्यारे छूटे
जो छूट गए फिर कहाँ मिले
पर बोलो टूटे तारों पर
कब अम्बर शोक मनाता है
जो बीत गई सो बात गई

Here is the translation –

Let Bygones Be Bygones
In your life, there was a star
And that was close to your heart
What if, it has faded
Look at the face of sky
Many of its stars fell away
Many of its loved ones went away
Those who left, never came back
But when does the sky grieve over the fallen stars
Let bygones be bygones.

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That’s about it from me for today.

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Until next time,
Vishal