Living through the trenches of 1917, and the barbed wire of investment returns
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Living through the trenches of 1917, and the barbed wire of investment returns

Jun 2022
Apr 2020
living through the trenches of 1917

1917, the Academy Award-winning film and best picture nominee, follows a young British soldier on a 24-hour suicidal mission to deliver a message beyond enemy lines to call off an attack doomed to fail after a German 'retreat'.

The movie is beautiful as it takes you on the emotional and tumultuous journey of a soldier on what feels like a single continuous struggle. This is a fun video on how the movie was filmed to look like one shot, with camera crews jumping from motorbike, to foot, to jeep, for just one scene.

Movie poster of 1917


He starts by waking from a nap under a tree with a clean uniform - somewhat naive, and somewhat hopeful.

The soldier walks through greenery through the camp, into the web of British trenches, progressively becoming more sickly, until he reaches the front line of mud and blood.

Just a few steps beyond his trench, he cuts his hand on barbed wire, the ground is littered with bodies and rats, he almost goes blind in a German booby trap, he loses a friend, he gets detoured. From confident to hopeful to desperate to victorious to defeated to outright reckless, he soldiers through to complete his mission.

He ends under a tree, just as he started - exhausted, though somewhat wiser and accomplished.

The life of a diligent, evidence-based investor, though with less risk of life, feels very similar. The soldier's seconds of uncertainty are our days. His need to grind it out for 24 hours is our lifetime.

It just so happens 1917 was a year before the 1918 H1N1 pandemic, spread far and wide from soldiers returning home. It is estimated to have infected 500 million people, one third of the world's population at the time, and claimed at least 50 million lives. 1918 is what experts think is the closest example to what we are dealing with in today's COVID-19 pandemic.

The emotional trench of investing

Uncertainty remains in how humanity, healthcare systems, governments, research initiatives, fiscal and monetary policy, and businesses will deal with COVID-19.

The markets consume and process information and perceptions, and are essentially a big data machine, taking all inputs and pricing risk in real-time.


It feels like slipping on mud in a trench. The last few weeks have been volatile to say the least. We have seen single day swings in the MSCI World (global developed markets index) ranging from -9.9% to +8.8%. Watching the markets move by +/-3% in a single day now feels "normal".

When we are in the thick of it, day by day, watching the value of our money move up and down feels gut wrenchingly awful.

We saw a -34% swing in just 28 trading days, followed by a 13% rally to bring us to -19% since the market peak on Feb 12.

MSCI World annual returns from 1970 to 2020 Q1

Investment returns since 1970

The MSCI World was down 21.1% through the first quarter.

For a hypothetical investor who diligently invested in the MSCI World from 1970 until the end of 2020 Q1, he would have seen their return reduce from a +6,810% return (68x his initial investment) to a +5,355% return (54x his initial investment) in three months. In terms of returns, we are back to where we were in the middle of 2017.

graph of MSCI World, growth of wealth from 1970 to 2020

But the investor has seen this before.

Over the course of earning over 50x on his investment, he had multiple instances of drawdowns greater than -40%, each time for different reasons, at different velocities, with different emotions, at different stages of life.

The barbed wire of investment returns

For investors who have recently started investing, this experience is far more challenging as returns on invested capital are most likely negative in light of the recent draw down. Training ourselves to tolerate such volatility is difficult, but the rewards of being in the market are well-known and understood.

You are putting in the work of patience and rational discipline towards a better life.

How to read the chart below: pick a starting year (vertical axis), and an ending year (horizontal axis). The intersection is the total return you get from being invested.

table of MSCI World returns matrix

As you can see as we move right and towards the top of the chart, our returns go from red (negative) white (positive) to light green, to dark green (3x to 10x return), to dark green with white numbers (10x+ returns).

The longer you are invested, the much higher your probability of positive outcomes.

"It's waiting that helps you as an investor, and a lot of people just can't stand to wait."
  • Charlie Munger, Vice-Chairman of Berkshire Hathaway and Warren Buffett's business partner

Investing from tree to tree, like our soldier

Before we invest, we are naive and hopeful of the future. We know there are risks and think we are strong. We don't think bad things will happen to us.

When we start investing and bombs start flying over our heads, and people start being blown up around us, we are scared. We smell guts and blood on the streets. We worry that 'this time is different'. We kick ourselves for signing up for this journey. We sweat and bite ourselves when we read the ever changing headlines on CNBC.

Illustration of the barbed wire of returns

When we power through we are relieved. We have made it through the barbed wire, completed the journey and understand why we tolerate risk. We find a tree to rest, stay invested, and know that we have done it right.

Unlike being at war, diversification means that a single bullet will not shoot you down.

Unlike being at war, you are betting on the collective productivity and innovation of humanity. Not fighting other humans.

Unlike being at war, investing well - staying diversified, keeping costs low, at a suitable risk tolerance - has a certainty of outcomes.

COVID-19 is a threat to our loved ones and humanity. It must be taken seriously by all of us to avoid unnecessary casualty. In time it will be overcome and the markets will, on average, reward people for their risk taken, as they have for known history.

"'This time is different' are among the most costly four words in market history."
  • Sir John Templeton (1912-2008), legendary investor, fund manager, and philanthropist
Long-term US returns, log scale

Stay safe and stay invested.


Investment involves risk. The value of investments and the income from them can go down as well as up, and you may not get the full amount you invested. Past performance is not an indicator nor a guarantee of future performance. Rates of exchange may cause the value of investments to go up or down. Individual stock performance does not represent the return of a fund. 

Any forward-looking statements, prediction, projection or forecast on the economy, stock market, bond market or economic trends of the markets contained in this material are subject to market influences and contingent upon matters outside the control of Pte. Ltd (“Endowus”) and therefore may not be realised in the future. Further, any opinion or estimate is made on a general basis and subject to change without notice. In presenting the information above, none of Endowus Pte. Ltd., its affiliates, directors, employees, representatives or agents have given any consideration to, nor have made any investigation of the objective, financial situation or particular need of any user, reader, any specific person or group of persons. Therefore, no representation is made as to the completeness and adequacy of the information to make an informed decision. You should carefully consider (i) whether any investment views and products/ services are appropriate in view of your investment experience, objectives, financial resources and relevant circumstances. You may also wish to seek financial advice through a financial advisor or the Endowus platform and independent legal, accounting, regulatory or tax advice, as appropriate.

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