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Chess vs. Rock, Paper, Scissors – Which Investment Game are you Playing?

Chess is similar to investing in that it requires a person to make complicated decisions under conditions of uncertainty and time pressure.

Growing up, my Dad taught me how to play chess and I thought it was a lot of fun.  

Today, I often find myself thinking like a “chess player” when faced with important life or financial decisions.  Chess can be a good analogy for investing, as there are certain tools (i.e. chess pieces or types of investments) that play an important role at different points within a strategy in response to changes to the positions on the chess board.  

Successful chess players are skilled at understanding which tools to use and when, and are adaptable to changing market conditions (i.e. opponent moves).

Skilled chess players are highly focused on “anticipating” their opponent’s moves, as are skilled investors when it comes to recognizing patterns in the market and “anticipating” the market by leveraging both experience and pattern recognition.  

Anticipation is key to having an edge with a fundamental investing approach.  For example, as in chess, the market can set up a Pawn sacrifice that looks like an obvious choice, but experience can help a superior portfolio manager anticipate and avoid subsequent trouble.

Do the best Grandmaster chess players win every match?  No.  Neither do the best portfolio managers win on every trade nor in every time period.  However, achieving Grandmaster status requires lots of experience and learning from both successes and failures.  It also requires, in our view, an obsessive commitment to honing the tools in one’s investment tool kit.

The “other” investment game being played by many, is Rock, Paper, Scissors.  This game is out of the investor’s hands, and depends solely on chance and luck.  Most of the frustration expressed by unhappy investors is a result of the inconsistent results following a Rock, Paper Scissors investing game.

“To invest successfully does not require a stratospheric IQ, unusual business insights, or inside information.  What’s needed is a sound intellectual framework for making decisions and the ability to keep emotions from corroding the framework.”  – Warren Buffett

Are you playing chess or rock, paper, scissors with your investments? To make sense of it all, the Smart Risk team is hosting an exclusive Vancouver Event that will bring together three panelist on November 2, 2016 from 5pm – 7pm who will offer a wealth of knowledge, insight and strategies in alignment with the Smart Risk principle of providing resourceful strategies and encouraging diversity of thought to support a constant state of evolution.

This exclusive Vancouver event: Volatility is Back – How to Navigate the Fear and Uncertainty using a Smart Risk Approach features a panel of three experts who will provide insight and action item on:


  • How to come out ahead of the US Elections
  • The Art and Science of investing in volatile markets
  • Disruption and Innovation in the ETF industry


Although space is limited, we have reserved a select number of seats for friends like you who might be new to the Smart Risk Approach.


Click here to apply for a complimentary seat to the event.

Please note that applying does not mean a seat is guaranteed. Apply here today.

Maili Wong

About Maili Wong

Maili Wong is an author, a leading Canadian investment advisor and licensed portfolio manager whose fresh, modern approach to investing for her high-net-worth clients sets her apart from others in her field. Her first book Smart Risk shares per personal story of resilience as well as lessons learned and secrets gleaned in her 15 years of international investing experience.