I was recently reading a story on the classical Greek philosopher, Socrates, who was tried and executed in 399 BC. He was tried on two charges – corrupting the youth, and impiety (perceived lack of proper respect for something considered sacred).
Socrates had done no such thing. What he had done was educate the youth, teaching them to challenge arguments from authority and question what they believed to be true.
In the process, he frustrated and embarrassed many powerful people with his constant line of questioning, known today as the Socratic method.
Another Greek philosopher Plato wrote an account of the speech Socrates made at his trial, called The Apology.
In The Apology, Plato wrote that the oracle at Delphi had pronounced Socrates the wisest man in Athens. No one was more astonished and disbelieving than Socrates himself. So he immediately set out to disprove the oracle by finding a wiser man.
Here is what Socrates found as he met a few supposedly wise men…
I went to one who had the reputation of wisdom, and observed to him – his name I need not mention; he was a politician whom I selected for examination – and the result was as follows: When I began to talk with him, I could not help thinking that he was not really wise, although he was thought wise by many, and wiser still by himself; and I went and tried to explain to him that he thought himself wise, but was not really wise; and the consequence was that he hated me, and his enmity was shared by several who were present and heard me.
So I left him, saying to myself, as I went away: Well, although I do not suppose that either of us knows anything really beautiful and good, I am better off than he is – for he knows nothing, and thinks that he knows. I neither know nor think that I know. In this latter particular, then, I seem to have slightly the advantage of him.
Then I went to another, who had still higher philosophical pretensions, and my conclusion was exactly the same. I made another enemy of him, and of many others besides him.
In the end, Socrates discovered he was indeed the wisest man in Athens. Not because of how much he knew, but because he was the only one who understood how much he did not know.
Perhaps nowhere is this lesson in humility more valuable than in the world of investing.
Knowing that you don’t know is the dawning of wisdom.
On this Diwali, my only wish for you as you march on your way towards wealth and prosperity is that this wisdom – of knowing that you don’t know – dawns on you sooner than later. That is what will propel you to start knowing stuff, start reading stuff, and start learning.
Knowing what you don’t know, accepting it and not being ashamed about it is the start of a continuing journey of wisdom. Recognizing the darkness is the prerequisite for bringing on the light. Only when the darkness is brought out of hiding does the light have the opportunity to illuminate it.
In the face of the unknown, a little humility is your best protection.
Now, how do you practice humility in investing?
Keep learning, be tentative in your decision making, change your mind if the facts change, diversify, and please don’t go around boasting about your successes.
Only then can you dispel the darkness of your ignorance, which is what this festival of lights truly signifies.
Let the light shine upon you.