March Madness and Mad Money

The season is upon us. Every year, countless hours are spent (or wasted) across corporate America trying to figure out the NCAA basketball tournament bracket. Some people will do extensive research, dig into analytics, look at which teams the professionals are picking and figure out their best bang for the buck with their own scoring system. Others will fill out a bracket in less than two minutes or make picks based on some simple metric, like which team mascot they like best. In the end, it’s just a game of chance. It’s gambling. If you win, it’s dumb luck. If you lose, it’s dumb luck as well, just the wrong kind of it. Nobody has it all figured out.

Oftentimes, people think of the investment world in similar terms. It seems like a game of chance. You can do some research, or you can skip that step. You can follow what other people are doing. In the end, you make your picks and hope for the best. It feels just like the March Madness brackets and gambling. But is this view accurate?

We believe that the answer should be a resounding “no,” but is too often a “yes” based on the actions people take. Here are some of the roll-of-the-dice approaches to investing that we have seen:

  • Trying to find a “sure thing” based on a hot tip. For example, “My dentist just made a killing on a health care stock. I should do that, too!”
  • Relying on recent trends to predict what’s going to happen in the future. Oil prices have been dropping, so they should keep going down, right?
  • Believing that “this time it’s different.” This type of thinking often causes us to shake off a cold reality. We know market timing doesn’t make sense, but when there’s an extraordinarily good or bad event, we say, “this has never happened before” and discard what the past has taught us.
  • Thinking professionals have “special” insights. You might believe that if someone is an investment professional, they can outsmart the markets. But their crystal ball can be cloudy, too!
  • Focusing on players instead of the team. You might fixate on a particular investment and not the overall portfolio. It’s like betting on the best basketball player instead of the best team.
  • Making “all or nothing” bets. You feel that the market is going to go down, so you move all to cash. That means you are 100% confident the market can go nowhere but down. Are you sure?
  • Avoiding contradictory evidence for what you have found to be true. You make a decision and search only for evidence that supports what you already believe.
  • Trying to recover losses quickly. Many people say, “I lost money last year, so to get back on track, I need to do better this year.” The problem here is that you try to exert control over the markets, which by their nature are uncontrollable and unpredictable. The markets may give back, but it takes patience.
  • Not understanding or accepting that sometimes it’s okay to lose money. In fact, it’s fully expected. You can’t win them all. But it’s like the NCAA regular season: You don’t need to win every game to make it into the big tournament.

Stick to your game plan

A successful investment strategy looks much different than the behaviors discussed above. Instead of relying on short-term guesses, hot tips and emotional responses, we suggest that you consider the strategies recommended by your Corient Wealth Advisor.

As you look at your investments, don’t think too much about what happened this week, this month or even this year. Instead, think about your long-term strategy. Assemble a winning team over time. Remember that investing has its ups and downs. It won’t always be a slam dunk, but you can still have a plan to win.


Different types of investments involve degrees of risk, including the potential loss of principal and varying fees and expenses. The future performance of any investment or wealth management strategy, including those recommended by us, may not be profitable or suitable or prove successful. Past performance is not indicative of future results.


Chad Carlson, CFP, CFA

Chad Carlson, CFP, CFA


Chad is a Partner, Head of the Central Region. He is based out of our Itasca, IL, office. Previously he was President and served on the Executive Team at legacy firm BDF. In addition, Chad led BDF’s Investment Committee, which oversaw both the strategic and tactical decisions for the firm’s entire investment portfolio. Chad is a frequent speaker and is often quoted in publications such as The Wall Street Journal, Forbes, Investment News, Smart Money and Dow Jones Newswires. Chad has been with BDF since 2005.