Before any mission, you conduct a thorough Operations Order (OPORD). No Army officer would charge into combat with no plan, no intelligence, and no risk mitigation strategy.
A by Kit Lancaster
Situation Report: What's Your Investment Strategy?
Before any mission, you conduct a thorough Operations Order (OPORD).
- You assess the terrain.
- You analyze the enemy situation.
- You establish a clear plan, execute with discipline, and adjust based on intelligence.
No Army officer would charge into combat with no plan, no intelligence, and no risk mitigation strategy.
And yet, that’s exactly how most people approach investing.
So, let’s conduct a gut check:
If I asked you to brief me on your investment strategy, would you have a clear, structured plan?
- Can you justify your investment decisions based on hard data and historical precedent?
- Do you have contingency plans for market downturns?
- Or are you just making emotional decisions and hoping for the best?
From my observations, most people—even highly disciplined leaders—are winging it when it comes to investing.
And hope is not a strategy.
The Illusion of Control: Why Most Investors Are Just Guessing
You wouldn’t execute a battalion movement-to-contact based on gut feelings. You’d use intel, planning, and discipline.
But when it comes to investing, smart, capable people abandon structure completely.
Let me ask you:
- Have you ever bought a stock because it was the hot topic in the news?
- Have you ever sold investments during a market dip because you were nervous?
- Have you ever sat on the sidelines, waiting for the “perfect time” to invest?
If so, you’ve fallen into the same behavioral traps that cause investors to consistently underperform.
And the data proves it.
The Dalbar Study: Why Emotion Kills Returns
If this were a field problem, the Dalbar Study would be your After Action Review (AAR)—and the findings would be brutal.
- The S&P 500 has historically returned 8-10% annually.
- The average investor barely earns 2-3%—not even enough to beat inflation.
- Why? Because they consistently buy high and sell low, reacting to fear and excitement instead of following a disciplined plan.
That’s the equivalent of failing to secure key terrain, reacting emotionally under fire, and losing the battle before it even begins.
Why Even Smart Leaders Make Bad Investment Decisions
Now, I know what you’re thinking.
"That’s not me. I’m a strategic thinker. I don’t make irrational decisions."
But here’s the truth—your military training doesn’t make you immune to human psychology.
Even the best leaders can fall victim to the same cognitive biases that destroy wealth.
Let’s conduct a quick enemy analysis—because your biggest threat isn’t the market.
It’s your own mind.
1. Loss Aversion – Why Pain Feels Stronger Than Gain
You understand risk management. But in investing, emotions distort the risk-reward equation.
- A 20% market drop feels catastrophic, even though history shows markets always recover.
- Investors panic, sell at a loss, and then wait too long to reinvest—locking in permanent financial damage.
Would you abandon a defensive position under indirect fire without assessing the bigger picture?
Of course not.
But that’s exactly what investors do when they sell in a panic.
2. The Dopamine Rush – The Thrill of a “Hot Investment”
There’s an undeniable rush that comes from making a great call.
- Maybe you bought Tesla early and saw it skyrocket.
- Maybe you got into crypto before it exploded.
- Maybe you think you’ve got a feel for the market.
But luck is not a strategy.
This is combat adrenaline at work—and just like in battle, making rash decisions based on emotion can cost you everything.
3. Overconfidence – Thinking You’re Smarter Than the Market
Army officers are trained to be confident—to make decisive choices with limited information.
But in investing?
Even the smartest minds—hedge fund managers, economists, and Nobel Prize winners—struggle to beat the market consistently.
So why would a battalion S3 or brigade XO think they can outguess an entire financial ecosystem fueled by trillions of dollars and AI-driven trading algorithms?
If we were briefing a commander, we’d say:
"What evidence do you have that you can predict the future better than the collective intelligence of global financial markets?"
The answer? None.
Are You Running a Disciplined Investment Plan or an Undisciplined Convoy?
Let me give you a scenario that will hit home.
You’re running a convoy operation in a high-threat environment.
- Your unit briefs the route in detail.
- You have checkpoints at specific waypoints.
- You have reaction plans for enemy contact, mechanical failure, or unexpected terrain.
Now imagine another unit operating in the same area.
- No route reconnaissance.
- No comms plan.
- No rehearsals.
- No contingency plan if something goes wrong.
Which unit do you think safely completes the mission?
Which unit do you think ends up in a world of hurt?
Now apply that same logic to your investments.
- A disciplined investor has a structured financial plan, diversified investments, risk management strategies, and a long-term focus.
- A reckless investor jumps into the market without research, chases trends, reacts emotionally, and hopes for the best.
One will arrive at financial security.
The other will take unnecessary financial casualties.
Which one are you?
Your Call to Action: Execute a Disciplined Investment Plan
So, let’s conduct our final review of the mission objectives:
- The Dalbar Study proves that emotional investing destroys returns.
- Behavioral psychology shows that humans are hardwired to make terrible investment decisions.
- Process-driven investors consistently outperform those who rely on emotion or “instinct.”
Now, it’s time for your Commander’s Intent:
Are you gambling, or are you investing?
If your investment decisions are based on emotion, speculation, or market timing, you’re gambling.
If your plan isn’t backed by data, historical precedent, and discipline, you’re gambling.
If your strategy changes based on the latest headlines, geopolitical news, or market swings, you’re gambling.
But if you build a structured, disciplined, and repeatable investment process, you’re investing.
And just like any well-executed military operation, structure and discipline win the long game.
So—will you take the time to create an evidence-based investment strategy, or will you keep flying by the seat of your pants?
The choice is yours.
Disclosure: This article is for informational purposes only and does not constitute personalized investment advice. Tax rates and laws may vary and are subject to change. Consult a financial advisor or tax professional for guidance tailored to your situation.
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February 2025