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Can Meditation make you a better investor?

Does meditation have any role to play in the material world of investing? Let’s find out what you should (and should not) expect as an investor from meditation.

Two thousand years back, Siddhartha Gautama took to the lotus position and started meditating disillusioned by his riches. He consigned himself to the forest and became Buddha, the Enlightened One. As an investor, it might sound weird that you are actually doing the reverse; considering meditation to obtain riches.

Does meditation have any role to play in the material world of investing? Let’s find out what you should (and should not) expect as an investor from meditation.

For starters, some studies have researched the ability of individuals who meditate to develop ‘alpha waves’ in their brain. Our brain waves change throughout the day and are generally divided into five different bandwidths – Delta waves, Theta waves, Alpha waves, Beta waves and Gamma waves.  Some suggest that when Alpha waves are prominent, it might indicate that your mind is generally clear of unwanted thoughts.

Moreover, after reading a bad headline, meditating investors are more likely to respond rather than react to it.

Generate ‘Alpha’

Interestingly, neuroscientists have found a correlation between an increase in alpha brain waves —achieved through meditation or otherwise —and its ability to increase creative thinking.

The late Steve Jobs praised the benefits of meditation in boosting his perception and intuition levels - by slowing down the mind’s usual chatter. Meditating investors often claim to have become more efficient after taking to meditation. Stilling their mind through meditation improves observation skills and their ability to decipher patterns and trends.

Reduce bias

Greed, for lack of a better word, is good, said Gordon Gekko (Michael Douglas) in the 1987 movie ‘Wall Street’. Interestingly, the parts of the brain associated with greed, expecting and anticipating a reward, are less active in the minds of those who meditate, points out Dr Daniel Crosby, author of the NY Times bestseller Personal Benchmark: Integrating Behavioral Finance and Investment Management’.

So as a meditating investor, you are less susceptible to fall into the trap of investment bubbles or quest for more significant returns.

Moreover, after reading a lousy headline, meditating investors are more likely to respond rather than react to it. Without jumping the gun, they take a momentary pause to reflect over its actual impact before making decisions. Often, the writing is on the wall, but amidst the market frenzy, investors fail to see it.

When investors get identified with ideas and beliefs, they become inflexible despite a shift in market dynamics. It could prove disastrous. Meditation can help you separate your ego from the market realities and help you let-go of strategies if they don’t fit the bill.

Perseverance

Meditation is seldom an easy proposition. Just try to close your eyes for 15 minutes, and you will realize it’s not easy. Meditating regularly for half an hour or one hour teaches you a lot about patience. In investing, patience is a real virtue. A wrong decision made on impulse costs a fortune and doing nothing often pays-off especially if you are in for the long haul.

So, next time you hear not so great news flashing on the screen, tone down the TV volume. Dim the room lights and slip into a quick meditation session. ‘Nothing in this world is permanent’ says Buddha. Even this negative news shall pass. Have faith in the large forces at play (the promise of equities that is) and stay put.

Don’t expect meditation to do miracles. Instead, think of meditation as a mere enabler on your journey.

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