Theory and Practice Are Different

Programming teaches you things

Some are things that are not easily seen. One that has remained with me for now 50 years, is this thought from computer scientist, Johannes Lambertus Adriana van de Snepscheut.

In theory, there is no difference between theory and practice. But, in practice, there is.

“Buy and Hold” is theory

A good one, but nonetheless just theory. A brilliant article about “Buy and Hold” explores the point. Easy in Theory. If you read nothing else today, read this.

The point is clear. Buy and Hold is abstract. A fine theory, but practice includes complications.

We are all people and people have foibles the abstract does not always take into account.

  1. Contextual differences. Like the Mount Hood example in the article.
  2. Things like fear, peer pressure, and changing circumstances. Also explored.
  3. Like emotional support. Even good teams have cheerleaders.

“Buy and Hold” in practice

The theory works in practice too, but only with some guidance.

The authors point. Get that guidance. Hire an advisor.

A price of 50 basis points annually will look cheap if it helps you avoid losing tens of thousands of basis points for contextual and emotional reasons. Investing wisely is more about managing the people than it is about managing the money. It is hard to see that from inside your knowledge prison.

There are fewer and more confined variables when dealing with money instead of people. A good advisor will help you manage yourself, which is hard to do, and only indirectly help you manage your wealth, which is easier.


I help business owners, professionals, and others understand and manage risk and other financial issues. To help them achieve their goals, I use tax efficiencies and design advantages to acquire more efficient income and larger, more liquid estates.

In previous careers, I have been a partner in a large, international public accounting firm, CEO of a software start-up, a partner in an energy management system importer, and briefly in the restaurant business.

Please be in touch if I can help you. don@moneyfyi.com 705-927-4770

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