Register For Our Mailing List

Register to receive our free weekly newsletter including editorials.

Home / 248

Five lessons from football and investing

Football and investing are both incredibly competitive. As a professional footballer for 16 years, I spent the better part of most weeks training and working to be the best I could be. At the same time, though, I was preparing for life beyond the football field, first by studying for a Bachelor of Commerce then for a Masters in Applied Finance.

During these years of blending football and finance, I learned some interesting lessons that link two professions that many might think have little in common.

1. It’s better to be a hedgehog than a fox

There was a time in my football career that I tried to be able to play pretty much every position. I thought that I would improve my chances of being picked for the senior team each week if I could attack up forward and defend down back. After reading Jim Collins’ book ‘Good to Great’ in 2010, I changed my approach entirely. Collins builds on Isaiah Berlin’s famous essay, The Hedgehog and The Fox, which itself was based on an ancient Greek parable: “The fox knows many things but the hedgehog knows one big thing.”

Instead of aiming to be good at everything, l narrowed my focus to being the best defender not just in the team, but in the whole competition (the hedgehog concept). My football improved dramatically with this focus.

I believe investing is similar. It’s not about how big your circle of competence is but knowing what your strength is and being better than anyone at that. Six Park is not about being everything to everyone but helping our clients by being the best robo-advisor.

2. More data doesn’t always mean better outcomes

Technology keeps providing new ways to analyse and measure player and team performance. However, diving too deep into data can distract from what is fundamentally important to a player and the team. At times, I noticed young players focusing a lot on GPS distances and average speeds, but that data was only useful if it complemented a review of their game. Instead, it was shifting their focus away from the fundamentals of what made them great footballers.

Finance often dives even more deeply into data than football, but it’s important to distinguish between what generates investment returns and what’s merely a distraction. There are key measures that deserve consistent focus but much of the data beyond this could be little more than white noise.

3. Humility trumps hubris

The best teams find ways to improve, regardless of the result of the last game. Humility can prevent hubris from ruining an individual’s career or eroding the culture of a team. Former All Blacks player Richie McCaw would write down the same words before each game – “Start again” – as a reminder that he needed to prove himself again that day despite every previous success.

By the end of my 16-year career, I could acknowledge that I was far from knowing it all. However, what I did know was that my approach to the continual process of training Monday to Friday would have the biggest influence on my weekly performance. I hope to be working in the asset management world in 30 years and, if I am, I should still be learning new things every day.

4. A healthy dose of paranoia is not a bad thing

Football and finance are intensely competitive, and a healthy dose of paranoia helps ensure you’re constantly improving, aware of risks, and pushing beyond your comfort zone. There’s a quote that’s relevant to both football and investing:

“If you don’t worry, then you need to worry. If you do worry, then you don’t need to worry.”

A former coach of mine, Essendon legend Kevin Sheedy, once said that a premiership can choke a player’s football career if they’re not careful. Sydney Swans coach John Longmire was often on edge with nerves during training sessions in November despite our first game being five months away and having had a good season the year before. He was always aware that 17 other teams were working hard to improve. In investing, your competitors are all working hard to find ways to outperform your team and it’s good to be aware of not only who’s ahead of you, but of who’s behind you.

As Andy Grove (CEO of Intel) once said, “Only the paranoid survive.”

5. Defence is more important than attack

AFL premierships are usually won by the best defensive teams, not the best attacking teams. There is a big difference. Good luck to your long-term performance if you just want to get into a high-intensity shootout each week with the other team.

In investing, too, there are differing approaches to diversification and uncorrelated returns and some focus on high risk. I’m not going to enter a debate about what’s right or wrong. What is consistent is that the best portfolios have a strong defensive element.

American investor Howard Marks said: “Avoid the losers in investing and let the winners look after themselves.” I think this is relevant to football too. At the risk of contradicting my third point, I’ve always said that in football the defenders will help win the premiership, while the forwards will help fill the salary cap!

Success in one week, one quarter, or one year in no way qualifies that the next time will be any easier. That’s what makes it hard, but that’s what makes it enjoyable. I think this constant challenge is why I am passionate about both football and investing. Each has helped me learn something new every day, and I don’t expect that to ever change. It was a privilege to play professional football and it’s a privilege to be trusted with someone else’s money.

 

Ted Richards is Director of Business Development at Six Park. This article is for general information and does not consider the circumstances of individual investors.

 

1 Comments
Andrew Varlamos
April 15, 2018

Thanks Ted. Nicely written. Cheers, Andrew

 

Leave a Comment:

RELATED ARTICLES

Charlie Munger on Buffett, gambling, Apple, and China

Five steps to become a better investor

Five reasons fund managers don't talk about skill

banner

Most viewed in recent weeks

16 ASX stocks to buy and hold forever, updated

This time last year, I highlighted 16 ASX stocks that investors could own indefinitely. One year on, I look at whether there should be any changes to the list of stocks as well as which companies are worth buying now. 

UniSuper’s boss flags a potential correction ahead

The CIO of Australia’s fourth largest super fund by assets, John Pearce, suggests the odds favour a flat year for markets, with the possibility of a correction of 10% or more. However, he’ll use any dip as a buying opportunity.

2025-26 super thresholds – key changes and implications

The ABS recently released figures which are used to determine key superannuation rates and thresholds that will apply from 1 July 2025. This outlines the rates and thresholds that are changing and those that aren’t.  

Is Gen X ready for retirement?

With the arrival of the new year, the first members of ‘Generation X’ turned 60, marking the start of the MTV generation’s collective journey towards retirement. Are Gen Xers and our retirement system ready for the transition?

Why the $5.4 trillion wealth transfer is a generational tragedy

The intergenerational wealth transfer, largely driven by a housing boom, exacerbates economic inequality, stifles productivity, and impedes social mobility. Solutions lie in addressing the housing problem, not taxing wealth.

What Warren Buffett isn’t saying speaks volumes

Warren Buffett's annual shareholder letter has been fixture for avid investors for decades. In his latest letter, Buffett is reticent on many key topics, but his actions rather than words are sending clear signals to investors.

Latest Updates

Investing

Designing a life, with money to spare

Are you living your life by default or by design? It strikes me that many people are doing the former and living according to others’ expectations of them, leading to poor choices including with their finances.

Investment strategies

A closer look at defensive assets for turbulent times

After the recent market slump, it's a good time to brush up on the defensive asset classes – what they are, why hold them, and how they can both deliver on your goals and increase the reliability of your desired outcomes.

Financial planning

Are lifetime income streams the answer or just the easy way out?

Lately, there's been a push by Government for lifetime income streams as a solution to retirement income challenges. We run the numbers on these products to see whether they deliver on what they promise.

Shares

Is it time to buy the Big Four banks?

The stellar run of the major ASX banks last year left many investors scratching their heads. After a recent share price pullback, has value emerged in these banks, or is it best to steer clear of them?

Investment strategies

The useful role that subordinated debt can play in your portfolio

If you’re struggling to replace the hybrid exposure in your portfolio, you’re not alone. Subordinated debt is an option, and here is a guide on what it is and how it can fit into your investment mix.

Shares

Europe is back and small caps there offer significant opportunities

Trump’s moves on tariffs, defence, and Ukraine, have awoken European Governments after a decade of lethargy. European small cap manager, Alantra Asset Management, says it could herald a new era for the continent.

Shares

Lessons from the rise and fall of founder-led companies

Founder-led companies often attract investors due to leaders' personal stakes and long-term vision. But founder presence alone does not guarantee success, and the challenge is to identify which ones will succeed in the long term.

Sponsors

Alliances

© 2025 Morningstar, Inc. All rights reserved.

Disclaimer
The data, research and opinions provided here are for information purposes; are not an offer to buy or sell a security; and are not warranted to be correct, complete or accurate. Morningstar, its affiliates, and third-party content providers are not responsible for any investment decisions, damages or losses resulting from, or related to, the data and analyses or their use. To the extent any content is general advice, it has been prepared for clients of Morningstar Australasia Pty Ltd (ABN: 95 090 665 544, AFSL: 240892), without reference to your financial objectives, situation or needs. For more information refer to our Financial Services Guide. You should consider the advice in light of these matters and if applicable, the relevant Product Disclosure Statement before making any decision to invest. Past performance does not necessarily indicate a financial product’s future performance. To obtain advice tailored to your situation, contact a professional financial adviser. Articles are current as at date of publication.
This website contains information and opinions provided by third parties. Inclusion of this information does not necessarily represent Morningstar’s positions, strategies or opinions and should not be considered an endorsement by Morningstar.