Investing in the Classics

Marcus Aurelius’ Meditations: On Stoicism – Part II

Please note that for the purposes of this analysis, I use the Gregory Hayes translation of Marcus Aurelius’ Meditations. Please refer to a previous analysis which I build upon.


Stoicism, as was seen in the first analysis, is characterized by the rejection of pleasure as standard of human happiness. Marcus Aurelius teaches that the good man, the wise man, the philosopher, is a man who lives in accordance with nature. He fears only abdicating his moral responsibility; he is not afraid of death, pain, public opinion, or poverty, he fears only that he should let himself down and be less than a complete human being. The only thing that is a concern of the Stoic is himself because he is the only thing that he can control. The Stoic conception of virtue is concerned with the collective good of the whole. The Stoic individual tries to live up to the highest potential of the upright human being. In this analysis, I will analyze the intellectual side of Marcus Aurelius’ Meditations, discerning lessons that are highly relevant for investors today. Marcus Aurelius has much to say about the value wisdom, the development of the self, and the reality of nature as a metaphysics of continuous flux and repetition. All of these lessons will resonate with the erudite investor, thereby suggesting a natural affinity between Stoic philosophy and the principles of value investing.


Marcus Aurelius’ attitude towards wisdom can be characterized as a relentless, egoless pursuit of knowledge for the sake of truth. Marcus’ deep affection for education is apparent. For example, he advises: “To avoid the public schools, to hire good private teachers, and to accept the resulting costs as money well-spent” (I.4). Roman nobles preferred to hire private tutors who were thought to be safer and more reliable than those who taught for free in public, but the main message is that education is not something to be parsimonious about. Education is only one thing, learning like a Stoic is another. The description of the Stoic way of learning and conducting oneself in the Meditations comes from the lessons Marcus records from the example of his adopted father, Emperor Antoninus Pius:

“Take Antoninus as your model, always. His energy in doing what was rational… his steadiness in any situation… his calm expression… his modesty… his eagerness to grasp things. And how he never let things go before he was sure he had examined them thoroughly, understood them perfectly… how he couldn’t be hurried… his tolerance of people who openly questioned his views and his delight at seeing his ideas improved on” (VI.30).

The description of Antoninus paints the Stoic as a rational and collected individual, unmoved from his principles, unaroused by emotions, and unprejudiced by his or others bias. Moreover, Marcus praises Antoninus’ eagerness to learn, persistency in to see affairs through completely, willingness to hear other perspectives, and humility to accept better ideas than his own. Elsewhere, Marcus affirms much of the same, writing: “He never exhibited rudeness, lost control of himself, or turned violent. No one ever saw him sweat. Everything was to be approached logically and with due consideration, in a calm and orderly fashion but decisively, and with no loose ends” (I.16). Like any sagacious investor, one ought to distance their emotions from their judgments, they ought to slow the game down, so to speak, be logical and deliberate, as well as decisive and thorough.


The importance of perspectives is a principal concern of Marcus Aurelius. He oft repeats the necessity of the willingness to hear other opinions out and the humility to yield when applicable. Writing again of Antoninus, Marcus praises “This, in particular: his willingness to yield the floor to experts – in oratory, law, psychology, whatever” (I.16). Borrowing from Socrates, Marcus believed that true wisdom is knowing that you don’t know. Thus, the necessity of, recognize one’s own fallibility and opening oneself to other points of view. A wise individual also must learn how to sift through perspectives, and learn to yield only for the proper reasons:

“reconsider your position, when someone can set you straight or convert you to his. But your conversion always rest on a conviction that it’s right, or benefits others – nothing else. Nor because it’s more appealing or more popular” (IV.11).

Elsewhere, Marcus reiterates:

“If anyone can refute me – show me I’m making a mistake or looking at things from the wrong perspective – I’ll gladly change. It’s the truth I’m after, and the truth never harmed anyone. What harms us is to persist in self-deceit and ignorance” (VI.21).

One must have the humility to be corrected, but one should only change if their conviction, founded on reason, is altered, not because the alternative is more appealing, convenient, or popular. Thus the investor must be humble, but not in any way that hinders his independence. Furthermore, Marcus reminds us that the truth does harm us if we have acted properly; but truth is always to the detriment of the ignorant and speculative. No investor is infallible, as such one ought to seek out all perspectives, study them carefully, weighing the evidence for each side, then reach their own conclusion. Afterword, the investor should not then tune out all other subsequent perspectives; instead, he or she ought to continually seek out new information and perspectives and test them against his original conviction, keeping an open mind but not folding for any reason other than those founded on reason.


In addition to the importance of considering others perspectives, another principal lesson regarding learning is the necessity of serious, in-depth enquiry. Marcus writes, “To read attentively – not to be satisfied with ‘just getting the gist of it.’ And not to fall for every smooth talker” (I.7). Proper enquiry is carried out with diligence, discipline, and focus. Writing of Antoninus, Marcus admires “His searching questions at meetings. A kind of single-mindedness, almost, never content with first impressions, or breaking off the discussion prematurely” (I.16). The pursuit of knowledge, Marcus reminds us, is not a languid pastime, but is tenacious undertaking for those who are not willing to accept mere appearance, opinion, or the shortest-route. The Stoic investor must “Practice really hearing what people say. Do your best to get inside their minds” (VI.53), so that he understand the incentives behind others perspectives. The Stoic investor ought to “Look inward. Don’t let the true nature or value of anything elude you” (VI.3), so that he draws his or her own conclusions, relying on others for perspective but not instruction.


In-depth enquiry requires that we “see things as they are” (IV.22). More specifically, Marcus comments that “At all times, look at the thing itself – the thing behind the appearance – and unpack it by analysis: cause, substance, purpose, and the length of time it exists” (XII.18). The Stoic thinker is logical and level-headed; objects of enquiry are broken down into its components and analyzed. The Stoic thinker also keeps the ‘big picture’ in mind as well, as Marcus states: “Identify its purpose – what makes it what it is – and examine that. (Ignore its concrete form.) Then calculate the length of time that such a thing was meant to last” (IX.25). Likewise, the Stoic investor is not pulled this way or that by fads, but carefully deliberates on each investment, analyzing its components, keeping in mind the business cycle so as to avoid both value traps or, conversely, buying in at the peak. Finally, Marcus’ advice: “Apply them constantly, to everything that happens: Physics, Ethics, Logic” (VIII.13). Physics for the Stoic investor: is what this business doing possible by the laws of economics and competition, is this an efficient operation or can it be improved, et cetera? Ethics: am I compromising any of my investment or moral principles, is management trustworthy, et cetera? Logic: does my investment thesis follow, what are my key assumptions, am I letting bias or emotion influence my judgment, et cetera?


Philosophy for a Stoic is not just a set of beliefs or ethical claims, it is a way of life involving constant practice and training. It is a cultivation of the self to become like the Stoic man. Perhaps one of the most quintessential Stoic metaphors is Marcus Aurelius call “To be like the rock that the waves keep crashing over. It stands unmoved and the raging of the sea falls still around it” (IV.49). Fortitude in the face adversity and chaos. The Stoic investor ought to be likewise, avoiding being swept up in oscillating tides of irrational exuberance. To be like this rock, one must have a sound mind as Marcus claims that “The things you think about determine the quality of your mind. Your soul takes on the color of your thoughts” (V.16). The quality of the mind is determined by what you let rule it. In the case of the Stoic mind, “The mind without passions is a fortress. No place is more secure” (VIII.48). Wants and wishes are one thing, passions another.  The mind that rules itself, governed by reason, is a fortress; it is the Archimedean point of the Stoic. Don’t let your passions be your tyrant, Marcus writes, “It’s time you realized that you have something in you more powerful and miraculous than the things that affect you and make you dance like a puppet. What’s in my thoughts at this moment? Fear? Jealousy? Desire? Feelings like that?” (XII.19).


Marcus Aurelius, in keeping with the theme of focusing on only what can control, advises that one ought to favor virtue over fortune. He writes, “I was once a fortunate man but at some point fortune abandoned me. But true good fortune is what you make of yourself. Good fortune: good character, good intentions, and good actions” (V.37). It is better to rely one’s virtue than fortune, he reasons, because fortune is fickle and fleeting whereas virtue is within your capacity to control. Marcus claims much of this when he states that “The elements move upward, downward, in all directions. The motion of virtue is different – deeper. It moves at a steady pace on a road hard to discern, and always forward” (VI.17). Virtue progresses, but fortune is fickle. Thus, Marcus reminds us: “This advice from Epicurean writings: to think continually of one of the men of old who lived a virtuous life” (XI.26). Likewise, investors ought to emulate the great investors before them in hopes of achieving a portion of their prudence and virtue. But to be a good student, Marcus teaches us that one must be wholly committed. “The student as boxer, not fencer”, Marcus teaches, “The fencer’s weapon is picked up and put down again. The boxer’s is part of him. All he has to do is clench his fist” (XII.9). His dictum is simple: the best students are the most serious, the ones that incorporate their teaches into themselves so that it becomes a part of themselves, and not merely an instrument that can picked up at will for they never become masters of that teaching.


The final development of the self is reflection and awareness of oneself. A hallmark tenet of Stoicism is the rejection of pleasure as the source of human happiness. Instead, the Stoic individual derives fulfillment for living according to nature and reason, upholding his moral obligations, and becoming a complete human being. The Stoic life is the ascetic life. Marcus Aurelius, despite his position as Emperor, lived a life of simplicity; for example, it was said that he slept on the ground instead of more lavish options. Marcus teaches much of the same:

“Not to waste time on nonsense. Not to be taken in by conjurors and hoodoo artists… Not to be obsessed with quail-fighting or and other crazes like that. To hear unwelcome truths. To practice philosophy… To choose the Greek lifestyle – the camp-bed and the cloak” (I.6).


“Treat what you don’t have as nonexistent. Look at what you have, the things you value most, and think of how much you’d crave them if you didn’t have them. Be careful. Don’t feel; such satisfaction that you start to overvalue them – that it would upset you to lose them” (VII.27).


“‘If you seek tranquility, do less.’ Or (more accurately) do what’s essential… Because most of what we say and do is not essential. If you can eliminate it, you’ll have more time, and more tranquility. Ask yourself at every moment, ‘It this necessary?’ But we need to eliminate unnecessary assumptions as well. To eliminate the unnecessary actions that follow” (IV.24).

Marcus teaches us not to be caught up with distractions. The unessential desires and actions are the source of our pains and failures, as they are fuel to our passions. But self-reflection and unrestrained moderation required to identify the unessential and the assumptions behind them. Many things we think are necessary are not. By eliminating unnecessary actions, we have more time for necessary actions, and more time for self-improvement and growth. This attitude is what separates the Stoic investor from the other types, especially the celebrity-activists, as the former see investing as a remunerative vocation in itself rather than for the sake of other accolades or corporeal goods.


Central to the composition of Stoic philosophy is their metaphysical view of nature. More specifically, Marcus Aurelius, as were other Stoic, was highly influenced by the Pre-Socratic philosopher Heraclitus, who believed that the only thing permanent was change. Building on Heraclitus’ legendary aphorism ‘you cannot step into the same river twice,’ Marcus writes:  “Time is river, a violent current of events, glimpsed once and already carries past us, and another follows and is gone” (IV.43). He reiterates this same metaphor many times throughout his Meditations, for example:

“Keep in mind how fast things pass by and are gone – those that are now, and those to come. Existence flows past us like a river: the ‘what’ is in constant flux, the ‘why’ has a thousand variations. Nothing is stable, not even what’s right here. The infinity of past and future grapes before us – a chasm whose depths we cannot see” (V.23).

The message is the same each time: everything is in flux. This includes even yourself, as Marcus writes, “Everything transitory – knower and known” (IV.35). The Stoic investor not only realizes that no two situations are identical, though they may have similarities, he or she also realizes that they themselves are constantly changing. Thus, the Stoic investor not only reflects on the manifold differences between different opportunities so as not to err, but also reflects upon themselves to see how past successes and failures have warped their perspective.


While Marcus Aurelius believed that nature is in a state of constant flux, he didn’t rule out that nature still rhymes with itself from time to time. “Frightened of change?” Marcus asks, “But what can exist without it? What’s closer to nature’s heart?” (VII.18). Change is essential to nature, just as abnormal profits naturally drive competition in a free market. Above average profitability rarely sustains itself in the long run. But for the Stoic, change doesn’t diminish causality. Stoicism believes that amongst the apparent chaos, there is still providence behind it, directing it. As Marcus writes:         

“What follows coheres with what went before. Not like a random catalogue whose order is imposed upon it arbitrarily, but logically connected… Not a mere sequence, but an astonishing concordance” (IV.45).


“Keep reminding yourself of the way things are connected, of their relatedness. All things are implicated in one another and in sympathy with each other. This event is the consequence of some other one. Things push and pull on each other, and breathe together, and are one” (VI.38).

Nothing is permanent except change, but there is causality to change, according to Marcus Aurelius. Perhaps more striking is Marcus’ belief in the cyclical nature of change, a theory that strongly resonates with investors. For instance, Marcus writes, “The world’s cycles never change – up and down, from age to age” (IX.28) and “Look at the past – empire succeeding empire – and from that, extrapolate the future: the same thing. No escape from the rhythm of events” (VII.49). The sagacious investor does not deceive himself into believing that anything is permanent or that two situations are identical, but he or she also recognizes that history does rhyme. Reversion to the mean is an all-too-powerful phenomena in the long-run. Thus, Marcus reminds us that “you shouldn’t be surprised that a fig tree produces figs, nor the world what it produces. A good doctor isn’t surprised when his patients have fevers, or a helmsman when the wind blows against him” (VIII.15). Like the helmsman, the stoic investor should not be surprised when the winds of fortune change, it is in its nature to. Instead, he should just focus on what he can control, namely himself, so that when fortune changes, he will remain as fortified like the infrangible rock while the speculators have no anchor from the thrashing waves.

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