Don't Go Swinging For The Fences by Brad Thomas

Summary

Building a solid retirement is actually so important that I don’t believe in swinging for the fences at all.
Swinging for the fences in investing involves buying sizable positions in skyrocketing stocks fueled by nothing but passion.
If the yield is sky high, then run.
This idea was discussed in more depth with members of my private investing community, iREIT on Alpha. Get started today »

There’s a relatively old idiom out there that advises people to “swing for the fences.” You’ve no doubt heard it before.

You’ve probably even used it before about something unrelated to sports. It’s become part of everyday lingo here in the U.S. We say it without even thinking half the time.

That (and one other to-be-explained reason) is why I’ll state the supposedly obvious. Quoting from online aide The Free Dictionary, here’s its “official” definition:

Baseball. Literally, to put all one’s power into one’s swing while batting so as to try to hit a home run. All they need is two more runs to win the game, so you can bet their star batter will come out swinging for the fences.
By extension, to put forward one’s maximum amount of effort or energy (into or toward something); to act or perform with great intensity or effort. I wasn’t sure about their state-appointed lawyer at first, but I was well impressed when he came out swinging for the fences on day one of the trial.

The other reason I included that description – even at the risk of making eyes roll – was because of the example sentences. They work well for the point I want to make about when you should swing for the fences.

And when you probably shouldn’t.

Photo Source

Winning the Game

This might not be the most popular opinion, but I don’t think you should always swing for the fences. Not even in baseball.

Now, this isn’t to say I’m completely against it in baseball. There are definitely times to go right for the gusto, as it were. Two types of situations come to mind right away:

When you’ve got a great track record of slamming them out of the park. When you’ve got nothing to lose. If the odds are with you, then why not go for it? And if the odds aren’t but they don’t matter anyway, again… why not go for it?

Let say’s it’s the bottom of the ninth. And the only way a team can win is if its last batter brings it home. All the way home.

In that case, there’s really only one thing to do. It’s obvious.

But overall, swinging for the fences means putting a lot more emphasis on power than precision. Which means it can be a great way to lose out on opportunities. Or whole entire games.

I just don’t see the point of that when the opposite – putting a lot more emphasis on precision over power – can get you so much farther.

More often than not, precision is going to get you more points. That’s why athletes train the way they do: to focus their strengths.

Raw power might lead to awesome individual moments. But it’s well-honed consistency that tends to carry the game.

The same can be said about investing. Except that, with investing, there’s a lot more on the line.

I’m not trying to downplay what athletes do. I’m a basketball man myself, and you’d better believe I took the game seriously when I was playing.

But there’s something more serious still out there.

...Originally Posted On Seeking Alpha

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