Good investing fundamentals

[note: I'm going to write as if this blog hasn't skipped a beat... hopefully those that have been waiting since March for a new post don't want to tar and feather me...]

When it comes to investing, there's a lot of talk about fundamentals. Usually, though, it's the fundamentals of the company we're investing in -- ie margins, sales growth, book value, etc. While finding good fundamentals in the companies that you invest in is definitely important, it's just as important to practice good fundamentals as an investor.

I actually got to thinking about this while watching golf over the past few days. I have to say, I was really pulling for Rocco Mediate to knock of Tiger Woods in the US Open. It's not that I dislike Tiger, it's just that Rocco is so darn likable -- plus I have a tendency to root for underdogs.

As I was watching, though, I was impressed -- as ever -- by Tiger. His fundamentals are tremendous -- keeping the ball on the fairway, sinking puts, etc. Rocco, meanwhile, played a very gutsy tournament, but did so by making some great shots to make up for prior poor ones. In the end, it was his inability to come back from a poor tee shot on the sudden death hole that sealed the victory for Tiger.

As an investor, it's crucial to be like Tiger. Do all the little things right to make sure that you're buying a quality company at a reasonable price each and every time. More importantly, keep focused and don't allow yourself to make infrequent, but big, mistakes that can seriously take away from all your other good investments. And through thick and thin demonstrate some mental toughness. The probabilities of investing assure that you will have investments that don't work out -- learn what you can from those, but don't let that disappointment cause you to do something stupid with a subsequent investment.

And as long as we're focusing on Tiger, I'd point out that if you don't feel like you have a solid investment process that you use to choose your stocks, then it's important that you take the time to step back from investing and establish that. Even though Tiger was one of the hottest golfers on the tour and was winning major events, he decided a few years back that his swing wasn't what he wanted it to be. So he made some major changes to it -- changes that led to an extended break in his winning ways. Today? Well, I'm no golf expert, but the results seem to speak for themselves.

It can be easy to get caught up in the actual investing of investing and not think much about the process of investing. So if you haven't thought much about your process lately, maybe now is a good time to take a step back and make sure your fundamentals are tip top. After all, it's fun to be Rocco playing for the US Open, but it's even better to be Tiger and winning time after time.

-AvgJoe