October 13, 2022

After spending much of last Saturday watching college football, most notably my Michigan Wolverines, I stumbled upon a movie chronicling a tragic Mount Everest climb. The 2015 film, Everest, is based on the same events of the more well-known book by John Krakauer, Into Thin Air. The film, as well as the book, tell the story of a fateful excursion in 1996 which resulted in the deaths of eight climbers.

While I had never done much research on Mount Everest, I was certainly aware of the inherent dangers of climbing to such heights. I assumed inclement weather, combined with the challenges of dealing with reduced oxygen, was the primary cause of death among those who perished on the world’s tallest mountain.

Upon researching a bit, I was not surprised to see that those causes are indeed among the top fatalities– along with falls and other medical conditions indirectly related to weather and altitude. I was surprised by several facts:

• More people have perished coming down the summit, than scaling it.
• Over 300 people have lost their lives while climbing Everest.
• The oldest summiteer was 80, and the youngest just 13.

Between watching the Everest movie, and reading several articles on the mountain, a part of me thought the idea of climbing a mountain was rather appealing. Realistically, at this point in my life, I know it will never happen, but it did rekindle my quest of “highpointing.”

Highpointing, is the activity of ascending to the highest point in each of the 50 states. My wife, and oldest son, started on this quest nearly 20 years ago as we were driving from Michigan to Georgia for a family vacation. I am not sure how we first got the idea, but on that trip, we were able to get the first five under our belts. I should note that many highpoints are very easy to “ascend,” as some are merely drive-ups (Tennessee, Kentucky) walk across a field (Indiana and Ohio). Nevertheless, it was fun imagining how, and if, we would ever get around to all 50.

After a fairly brisk start, family obligations crept in, and our pace decidedly slowed. The last highpoints we scaled were those in Alabama and Florida in 2016. The latter is actually the lowest high point in the United States. Britton Hill tops out at a majestic 345 feet above sea level and affords views of several hundred yards of surrounding countryside – not entirely unlike those of Ohio and Indiana.

Of the 20 we have notched, only a few required any real “climbing,” and most of those would be more properly categorized as rugged hiking. There are four or five in the United States that require actual mountaineering skills. Those are most likely out of my league, as they present some of the real dangers that have befallen climbers of Everest. Alaska’s Denali, which is the highest peak in North America, for example, requires up to four weeks of actual climbing, not to mention several months of training. Even then it is a major challenge as over 120 climbing deaths have been reported since 1932.

One commonality between these tragic deaths on Denali and Everest is the fact that most have occurred while descending. There are a few reasons for this including over-confidence (after all, you’ve been to the top), lack of planning, and a simple lack of patience. It should be faster going down, right? It struck me that these are many of the same reasons that lead to investors getting into trouble – albeit not life and death, but trouble, nonetheless.

So, what can be learned from mountain climbing that can trans- late into financial success? While I am certainly no expert in climbing, I do know that for me the keys to both investing, and my limited summiteering, are planning for anything and every- thing, relying on those who have more experience and discipline, and double-checking my plan. Yes, I know I included “planning” twice, but it really is the most important element to a successful, and safe excursion.

Discipline and planning are the hallmarks of successful investors. These characteristics, just as in mountaineering, can make the difference between triumph and failure, as many investors tend to veer away from their plan at the most inopportune time. More often than not, this occurs when the markets become un- certain. To continue with the climbing analogy, this is usually most pronounced during a market descent. It is precisely at this time that sticking to the plan is of utmost importance. Accumulating money (climbing up) can be very rewarding but preserving it (climbing down) is just as important.

Sir Edmund Hillary is well known in the annals of Mount Everest lore as being the first to reach the peak. In fact, though, he was the first to do both - climb to the top and navigate his way down successfully, which he accomplished in 1953. However, the English mountaineer George Mallory is often credited as being the first to reach the summit back in 1922, but he did not make it back alive. Getting to the top is only half the journey, a safe descent is the other half.

The article above is an excerpt from the Q3 Quarterly Market Commentary. Here is a link to the most recent issue. Complete the form below if you would like to get this emailed to you each quarter.