Although last night's game between the Miami Dolphins and the Pittsburgh Steelers (our reigning Super Bowl champions) officially started the regular NFL football season, things don't really kick into high gear until this weekend.
And, as usual, the professional football analysts and the talk radio pundits will be filling the airways with an assortment of inane commentary and dubious analysis.
I have grown accustomed to the former; it is the latter -- especially when the pundits attempt to pass off their analysis as the product of hard-won wisdom from years of watching, playing, or coaching football at the professional level -- that drives me crazy.
Why? Because much of their analysis is either unimportant or, worse, wrong. In this way, it is similar to much of the blathering that you will hear on the financial news networks.
It being the start of the season, I won't burden you with all of the analysis that I find questionable (after all, I too have to stock up with beer and chips to prepare for the weekend). Instead, I just want to highlight one piece of flawed advice.
Many analysts will state quite emphatically that a quarterback's pass completion percentage is an important statistic. To emphasize the point, the networks will regularly flash the ratio up on your screen throughout the game.
But the statistic has relatively little worth. Moreover, if people focus too much attention on it, the statistic can lead fans astray -- thinking either that their QB is doing better than he really is, or alternatively, not as well as he really is.
Now it goes without saying that a completed pass is better than an incompletion (except in those rare instances when a screen or short pass actually ends up in a loss). But what analysts and fans should be more concerned with is the numbers of yards per completed pass that their quarterback achieves.
Think of it this way: Completing three of three passes for nine yards is good (3 yards per attempt), but completing one of three passes for ten yards is better (3.4 yards per attempt).
And here comes the investing analogy. If you are like me, you tend to fret over every dropped pass in your portfolio. And so far this year I have had my share of dropped, or if you will, "incomplete" passes, including Intel
Obviously the analogy isn't perfect, because unlike an incomplete pass, "incomplete" investments can get up off the ground and begin moving your portfolio downfield again. My point is this: the goal of investing, like football, is to continually advance toward the goal. And winning a football game, like winning in the market, often requires that you successfully employ a variety of different tactics: running, passing, and kicking on the gridiron; or, in investing, mixing up small, mid-size, and large-cap stocks with bonds.
In both football and investing, it is important to develop a sound game plan. But as you assess your performance, it is just as important to stay focused on those statistics that offer the best indication of success.
Interested in other Foolish investing analogies? Check out these stories:
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Fool contributor Jack Uldrich is a Minnesota Vikings fan and misses the good old days of Daunte Culpepper going deep to Randy Moss. He owns stock in all of the companies mentioned in this article. The Fool has a disclosure policy.
