Why a foolish consistency could sink Anthony Martial - and your portfolio


After a brilliant display against Real Madrid, Manchester United forward Anthony Martial was urged by manager Jose Mourinho to produce that form more consistently. My initial response: Well, yeah, no kidding. It would be great if Martial could consistently go past players and create goal-scoring opportunities. But it turns out that's a hard thing to do, which is exactly why it's valuable.

In the wrong hands, the mantra of consistency can be dangerous advice. As a young tennis player, I was often told to be more consistent. Playing more consistently was usually synonymous with going for higher-percentage shots - playing the ball cross-court, for example, instead of trying to hit a winner down the line.

Taken to an extreme, though, that's a recipe for mediocrity. That's how you end up with United crossing the ball 84 times against Fulham. That's how you get Tom Cleverley's meaninglessly high pass completion percentage. That's how you get basically the entire Louis van Gaal era. Emerson said that a foolish consistency is the hobgoblin of little minds, and it gets you a pretty lousy football team too.

You see the same thing in the world of investing. Allocators, for example, always claim to be "patient capital", but experience shows they find it hard to stomach any period of underperformance. Effectively, they're asking for portfolio managers and strategies that have high returns AND low volatility. Other than investing with an early Bernie Madoff, there aren't a lot of ways to get that risk/return profile.

Investment theory has one answer to this conundrum in the form of diversification. It's sub-optimal to invest only in US equities (despite what Jack Bogle says). Equally, it would be stupid for Martial to always try to take a defender on. By diversifying your assets, or varying the shot you play, you end up with a better result overall. The key here is to know when and how much to diversify.

Gambling and investing legend Ed Thorp has much to offer on this topic. It all comes down to one's "edge". As Thorp says, "When I had the edge, I bet big, but not so big as to risk going broke. When the cards favored the casino, I played defense, to limit my losses. The same approach worked on Wall Street: the bigger my edge, the more I bet and the greater the risk the more cautious I was." Applying this to football, it's better for Martial to take a defender on when the latter is slightly off-balance or off-guard. But in all these fields, it's imperative to keep honing one's skill in identifying edge.

Another way to continue developing an edge - other than relying on circumstance - is good old-fashioned hard work. It turns out Mourinho's advice to Martial is a little more nuanced, as you'd expect of a manager who's won everything the game has to offer. Two quotes suggest Mourinho is more than just a party-pooper. "He was enjoying it and trying things, it's important to try things in these friendly matches, so it's good for Anthony and his confidence." What really seemed to matter to Mourinho: "I can say he is training better than before, he's working harder than before." Reframing this, Mourinho might be saying, "I'm comfortable with the variance in the performance, but I'd like to raise the mean. There's a bell curve, but I'd like to shift that to the right, and hard work is the key to that shift."

There are a few lessons I'm trying to learn from all this:

1) Raise your game, but find an appropriate level of inconsistency. Minimizing variance is rarely the ideal strategy, and it's probably preferable to raise the average than to reduce the "inconsistency", or variance.

2) Surround yourself with people who understand this philosophy. The world is full of people who hate uncertainty and don't appreciate a probabilistic approach to events. They're often the first to criticize strategies with a whiff of risk, without questioning whether the reward outweighs the risk. It's draining to be around people like that, and you have to wonder how many players had the positive "inconsistency" coached out of them in the Van Gaal era.

3) Have the confidence to ignore people who don't get it. I always thought Nani was one of the most talented and exciting players at Manchester United. But he had a tendency of losing confidence when fans got frustrated with him, effectively cutting off the right tail of performance.

These are all more easily said than done. But Thorp made it work for him. Here's hoping Martial will do the same.