Force for thought — 17.01.25

To Have and To Hold

How do you hold onto a good thing and not let it go before it has time to work its magic? By mobilising a method that works. No one is insulated from the challenges of sticking with something promising — not a diet, nor an exercise regimen, or even a first date — the moment it becomes uncomfortable and hard. Why should investing be any different?

We’ve collected more than four million data points that demonstrate how a particular methodological communication enables investors to hold on for the ride. The proof stretches beyond investing: our ability to hold on when we least want to — in order to withstand things that can cause our undoing — has application everywhere. Each week, we’ll show how and why a mechanism for holding on, in investing and in life, is so powerful.

Zooming in

How powerful is positive feedback? In 2011, researchers set out to answer this question, conducting an experiment to determine how often medical staff sanitised their hands before and after seeing patients. Incredibly, even though cameras were set up inside the hospital with staff knowledge, only one in 10 medical staff washed their hands before and after patient interactions. To boost handwashing, researchers implemented a critical intervention, via an information board, to generate a constant positive feedback loop. Every time medical staff sanitised their hands, the board kept score in real time. This presented staffers with both an immediate reward system — incentivising them to wash their hands — and enabled them to monitor their progress rather than fixate on the times they erred. The result? Compliance accelerated to almost 90 per cent.

So, what can we learn from this particular example? A lot, actually. For starters, the experiment itself demonstrates that even if something is simple to do — even when it is natural or innate — we often fall short of doing it without a system in place. How on earth will we fare, then, in the case of investing without a routine and habitual protocol? Short answer: we won’t. The experiment also touched on something much more fundamental. Instead of implementing negative strategies — highlighting disease or potential danger — researchers only used positive interventions to generate more handwashing. Why? Because humans are hardwired to turn away from or avoid danger. In fact, research shows that warnings have limited effect on our behaviour and can actually inspire inaction. That’s why so many would-be investors stop in their tracks; the ceaseless negativity and fear-mongering in the media turns them off. Oppositely, by repeatedly highlighting progress, it has been shown that people are much more likely to optimise their performance — not just in hospital environments, but in investing too.

To Have on Hand

“You can’t let your emotions drive your decisions, because they will often stop you from making the right decision.” In her book Let Them, motivational speaker and podcast host Mel Robbins illuminates how powerful our emotions can be — but also how flighty and fickle they are at times, requiring reining in. She highlights a fascinating phenomenon: most emotions will come and go within 90 seconds so long as we don’t react to them. If we invert, that means countless decisions we make every day — in investing or otherwise — are hardly given due time, yet can change the course of our lives…