Wayne Gretzky was the greatest hockey player ever. The Canadian legend's 20-year career brought the Stanley Cup to Edmonton four times, and his trade to the Los Angeles Kings in the late 1980s helped cement the popularity of the sport in the U.S. as the National Hockey League's southward expansion continued. On a personal level, Gretzky's determination and discipline helped him make the most of his innate talent and reach the top of the sport.
But many of the tenets that Gretzky used to motivate his hockey play also translate well for those looking to become better investors. Let's take a look at four quotes from the Great One that you can use to invest better.
"Skate to where the puck is going to be, not to where it has been."
This famous Gretzky quote is perhaps the best-known of the things the Great One said during his career, and it has become nearly ubiquitous in the business world as well. Everyone from Apple's (NASDAQ:AAPL) Steve Jobs to Berkshire Hathaway's (NYSE:BRK-A) (NYSE:BRK-B) Warren Buffett has trotted out this hockey quote as a metaphor for being smart about anticipating trends and staying ahead of the crowd.
For most investors, the key to the Great One's advice is not to panic about bad things that have happened in the past. Instead, it's essential to look forward and anticipate what effects past events will have on the future. Often, if you can realize that bad news in the past will quickly reverse itself and become good news in the future, you can beat the herd of bullish investors and pick up a stock at a bargain price.
"You miss 100% of the shots you don't take."
Gretzky was known for taking a lot of shots, and that definitely played a key role in his becoming the all-time leader in goal-scoring in the NHL. He didn't let uncertainty about how a shot would turn out stop him from making the attempt. Moreover, Gretzky also inspired his own teammates to climb toward success, as the Great One had more than twice as many assists in other players' goals than he scored himself.
Investors can benefit from the same guidance. Even though you'll never be certain about whether a company will become the next leader in its industry, that's no excuse not to do your research and make your best assessment of that company's likelihood of success. Moreover, even if your investment doesn't do well right off the bat, it can set you up for eventual success if you correctly recognize the positive trends that will help your stock thrive in the long run and have the tenacity to stick it out through the bad times. Your research might lead you to reject one company but point you in the direction of an even better prospect that you otherwise would have missed entirely.
"I couldn't beat people with my strength; I don't have a hard shot; I'm not the quickest skater in the league. My eyes and my mind have to do most of the work."
Not everyone agrees that Gretzky was the best hockey player ever. Fan loyalty aside, many sports analysts note the different skill sets that made players Bobby Orr and Gordie Howe greats in their own right. Even Gretzky himself said he would have picked one of those two players over him when The Hockey News put him at the top of its Top 100 all-time list. But even those who prefer Orr, Howe, or others acknowledge that Gretzky worked hard at being the best he could be and took maximum advantage of the situations in which he found himself.
Investors also need to understand the value of playing to their strengths. You won't have the lightning-fast trade executions of a high-frequency trader or the vast library of research resources of a Wall Street firm. But what you do have is the patience to stick with an investment for the long run. You have expertise in particular fields that can help you evaluate investments in certain industries more effectively than the average investor. And most importantly, you have the ability to control your emotions and make the most of your knowledge and wisdom. Use those to their fullest, and you can achieve much better results than most investors ever will.
"I just like to keep my money in the bank; I'm not a big risk-taker. I don't know anything about the stock market -- I stay away from things I don't know anything about."
For all that investors can use Gretzky's quotes to inspire them, even the Great One didn't feel the need to be aggressive with his own money. When you have a career that brings you hundreds of millions of dollars, taking risks isn't really necessary, and preserving your wealth takes a higher priority over maximizing its growth.
Most investors, though, don't have the luxury of a professional sports career or celebrity endorsements to bring in regular income. For you, investing is a necessity -- but it's one that doesn't have to involve the big risks Gretzky referred to. Indeed, learning about the stock market is the initial step everyone has to make in order to get into a position where the market can help you realize your financial dreams. Staying away from things you don't know about is smart, but it shouldn't keep you from learning about the things you need to know, and then taking full advantage of them once you develop the skills you need to succeed.
The hockey world might never see another player like Wayne Gretzky. But by taking his advice to heart and applying it to your investments, you could become pretty great at providing for your financial future.
Dan Caplinger owns shares of Apple and Berkshire Hathaway. The Motley Fool recommends Apple and Berkshire Hathaway. The Motley Fool owns shares of Apple and Berkshire Hathaway. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.