There are two sports that I plan to give up for good.

One of them is golf, in which my handicap is a sandtrap.

The other is the stock market, in which my handicap is quicksand.

And I have a hunch my shortcomings in these two charming pastimes may not entirely be a coincidence.

The similarities in these two sports seem rather striking.

It seems that both require a steel-trap mindset and single-minded focus.

If you’re thinking about your 360-degree slice while placing a market order on E*Trade to chase a high flyer or thinking about averaging down on Nortel Networks (NT-TSX) for the 18th time while addressing the first tee at GlenEagles, lawn bowling may be just the sport for you.

Which brings us to Tiger Woods, he of the steel-trap mindset and single-minded focus.

If you want to win in the stock market, you could do worse than go to school on Woods, the golfing sensation.

Woods’ remarkable consistency on the pro tour is largely based on an uncanny ability to maintain an even keel mentally.

This sound mental approach allows him to blank out the adversity of a bad shot while others with comparable physical attributes allow botched shots to destroy their entire game, thus turning a pleasurable outing into what Mark Twain aptly described as “a good walk spoiled.”

The same can be said of the stock market.

In the bear market of the past couple of years, many investors could have saved themselves the triple-bogey plays such as Nortel or Book4golf.com (BFG-TSX Venture) if they had harnessed their emotions, set reasonable goals and stuck to a game plan.

When these stocks began to fall off a cliff, many investors – no, we won’t mention any names – let their emotions overrule common sense and stubbornly refused to take a minor loss before it became a major loss.

You can bet your Big Bertha that if Woods had bought Nortel at $100, he would have saved himself from disaster by practising the stock market discipline of having an automatic stop-loss order for when Nortel dropped, say, 10 or 15 per cent. More importantly, he would not have diverted from the all-important game plan.

One might equate a stop-loss order in the stock market to taking a drop in golf instead of taking a near impossible shot off the back of a squirrel.

And, speaking of impossible shots, how do you think John Daly, the tour’s hot-headed swinger, would have minded his portfolio in a bear market?

Probably by killing the poor squirrel.

One would suspect the gifted but cantankerous Daly would have also lost his way with Nortel, as many investors did, by averaging down on Nortel all the way to the current $4-$5 range which, in golf terms, would be akin to taking several wild machete-style swings at a ball hopelessly buried in quack grass.

If you’re from the John Daly school that underscores the golf axiom of drive-for-show and putt-for-dough, having tossed your clubs into a placid pond after firing four tee shots into the drink, you’re probably better off keeping a safe distance from the stock market and its murderous bunkers.

While Tiger Woods ought to be doing clinics on the psychology of investing, Warren Buffett, Wall Street’s answer to Tiger Woods, ought to be doing clinics on golf.

If you study Buffett’s unmatched game plan in growing Berkshire Hathaway (BRK.A-NYSE) stock to $75,700 per share, you might learn to stay out of the drink.

It’s often wise to lay up in front of the water, in golf, finances and life. If that sounds boring, you’re probably one of those bear market casualties who waded into the pond, oblivious to the crocodiles lurking in the weeds.

* ANALYSIS OR PARALYSIS?

It wasn’t so long ago that virtually all research reports said essentially the same thing: BUY! (Although at the time, we may not have realized that it was often an oxymoron which really meant SELL!).

Now that analysts have discovered a new vocabulary with trick words such as hold, accumulate and sell, it can be mind-boggling trying to figure out exactly what they’re trying to say.

A case in point: Research Capital analyst Rob Millham’s recent report on Wi-lan in which Millham offers mixed signals, lowering his 12-month target price to $3.50 from $4 while at the same time upgrading the stock from hold to accumulate.

* SAGE ADVICE: “Sudden success in golf is like the sudden acquisition of wealth. It is apt to unsettle and deteriorate the character.”



– P.G. Wodehouse.

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