This article appeared in The Carnival of Personal Finance #127.
"The people who want to achieve and aspire to be very good in their profession don't mind the way we do things. It's not normal to want to be as good as you can be. It's normal to be average. "
-- Nick Saban, Head Football Coach, University of Alabama
Ok, I'll go ahead and fess up. I am a college football fan, more specifically a University of Alabama football fanatic (Roll Tide!). Unfortunately, we have drifted in and out of mediocrity since Coach "Bear" Bryant retired after the 1982 season. We have had highs like winning our 12th national championship in 1992 and lows of being put on NCAA probation in 2002. We have changed coaches many times since 1982 and each time I hoped the new coach would be a winner. I never knew what was coming, until Coach Saban was hired.
From the first time I heard Coach Saban speak, it was no longer a matter of if we would return to our past championship ways, I knew it was only a matter of time. This is a man that will not settle for average. He points out in his book that his philosophy and teachings are not football specific. They can be applied to anything in life, including your family, your job or even your portfolio.
So many people just put their money in an index fund and are content with earning slightly below average returns (slightly below average = average - a management fee). Don't get me wrong, that's ok for most people. If someone doesn't have the time, desire or aptitude to personally manage their investments, they should be commended for saving the best way they know how.
However, my goal is never to be average. For a market average to exist there must be stocks above and below the midpoint. I'm willing to sacrifice and put in the time and effort necessary to be above average. Time and effort doesn't always equate to success, but it sure doesn't hurt. I would have much rather tried and failed than to have never tried at all.
I'm pumped! Let's go analyze some stocks! Roll Tide!