The year was 1612. The place was feudal Japan. Miyamoto Musashi – the esteemed yet vagabond Ronin, wanted to put an end to the notion that Sasaki Kojiro – famed samurai – was a superior swordsman. So a duel between the two was arranged.

Kojiro, also known as ‘The Demon of the West’, was a fearsome swordsman who wielded a Nodachi – The largest and heaviest of the samurai swords. With a blade of over 90cm, it exceeded the standard Katana blade length by 20cm. Kojiro was considered one of the best – if not the best – duelists in all of Japan. It is said he had aristocratic standing, a large stature and dressed flamboyantly to further intimidate his opponents.

The duel was set for early in the morning of April 12, 1612, on the small island of Ganryu. Kojiro and a group of spectators awaited the arrival of Musashi, who eventually arrived by row boat – several hours late. Shockingly, he came ashore with only a wooden oar, carved into a slimmer profile, as a weapon.

Kojiro was enraged. Disrespected by the late arrival, and taunted by Musashi’s choice of weaponry, he pulled his massive nodachi from its scabbard and hurled the sheath away into the sand. Musashi turned the screws further by saying “If you have no more use for your sheath, you are already dead.”

The Duel was a short one. Both adopted defensive postures, but Musashi used Kojiro’s anger as a distraction, and subtly moved his position to direct the sun into Kojiro’s eyes….Kojiro attacked, his massive sword swooping at Musashi, Musashi parried and countered with the wooden oar…..and Kojiro collapsed, mortally wounded.

The outcome of the duel for Musashi was victory but also regret. It is said he bowed to his fallen opponent and the spectators before leaving the island and vowing never to fight a lethal duel again.

Many years later, in 1645, nearing death, Musashi – Ronin, Philosopher, Artist – wrote “The Dokkodo” (The Way of Walking Alone) for a favourite disciple. It was a list of 21 precepts – guidelines for living that he sought to leave as a gift to the future.

The list seems a blend of stoicism & pragmatism, formed from a life fully lived – violently, artistically and philosophically – in an era that has vanished to time. What relevance does The Dokkodo have to life in the modern world? Can it give us an advantage in investing ? (This blog is about investing after all).

Precept 15 of the Dokkado may hold a clue – It is commonly interpreted as “Do not act following customary beliefs” or “Have trust in yourself and avoid superstitious beliefs”.

With this precept, Musashi seems to be endorsing a philosophy of original or independent action and thinking – specifically advising to not follow customary (normalized, accepted) beliefs. It can be read that he is also encouraging one to trust in ones own abilities and deliberately choose to think and act differently in accordance with one’s own experience.

Let’s apply this precept as a lens to the accepted knowledge and behaviours of the investment world. I contend that 95% of the retail investment world’s thinking is standardized. Uniform. Collective. Unoriginal. Even Superstitious. So powerful is the gravity of common belief, that prognosticators or thinkers who deviate from the ‘norm’ in terms of analysis barely venture far. The entire investment community seems to be a massive groupthink exercise, discussing the same topics, with similar analysis, using the same tools, educated and informed by the same institutions and media. Although the availability of information for investors is better, broader and faster than ever in human history, the result seems to be an accelerated homogenization of thinking…..further pounding into our psyche the ‘importance’ of playing by the system’s collective rules. Distilled to its logical conclusion, everyone gets the same results. Success means marginal, infinitesimal outperformance. There are no ‘victors’.

In this environment, how does one achieve something significant, and step above the average to victory? As Musashi states, “Do not act following customary beliefs”. Musashi isn’t advising to be foolish or careless. He is instructing to “Have trust in yourself” and act originally with your own skill and knowledge. Follow your own path.

Now Musashi wasn’t an investor. Although, as is clear in his writings, he understood and respected the way of the merchant class. He was a warrior – A Ronin – Masterless Samurai, who defeated over 60 opponents in singular combat duels, many of which were to the death. He walked his own path, came to his own conclusions, and achieved a pinnacle of (albeit bloody) success and wisdom in his field that will remain unassailable.

And he accomplished his ascent through study, experience and by trusting himself to do things differently, as he did at the Duel on Ganryu Island in 1612.

The question, for all of us investors, remains – Do you do things differently, and do you have trust in your abilities? If not, why do you expect to win?

GLTA!