For Individual Investors, Risk Is Not Having Enough Cash To Spend When Needed

Twenty years ago I entered my first multi-day motorcycle endurance competition.  It began and ended in Columbus Ohio.  I had entered this event without any previous knowledge of what it would take to ride a motorcycle for five days in a row averaging a little over 1,000 miles per day.  Looking back, I should have sought some advice from a few experienced endurance riders.  Instead, I just jumped on my trusty Kawasaki Concours with a stack of AAA road maps and headed to Ohio. 

One of the experiences I have always valued from my motorcycle trips is getting to visit with people from all walks of life.  For most of my trips, I make sure I have time to sit and visit without the pressure of a schedule.  And if my destination is work-related, I get the added benefit of a tax deduction.  For this trip, though I was heading to Ohio for a motorcycle competition, I thought I might be able to incorporate a little work to help offset some of the travel cost.

So I thought of whom in Columbus Ohio I could visit with to add to my knowledge and qualify the trip as a business expense.  At the time we owned shares of BankOne, who for the majority of its history was headquartered in Columbus.  But alas, they had moved to Chicago a year before. There was another option, however, that could potentially combine a little business with my trip. Of the many individuals who have influenced our approach to portfolio management, one that stands out is Robert H. Jeffrey, head of the Jeffrey Company.  The Jeffrey family sold their manufacturing business in 1974, and with the proceeds of the sale turned the company into an investment vehicle operating out of Columbus.

I first discovered Mr. Jeffrey when I came across an article, published in the Fall 1984 edition of The Journal of Portfolio Management, titledA New Paradigm for Portfolio Risk. A short summary of this paper provided by the Jeffrey Company is as follows:  “Risk is a function of the cash-flow relationship between a portfolio’s assets and its liabilities, i.e., it’s the probability of not having sufficient cash with which to buy or retire something important.”

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Disclosure: Anderson Griggs & Company, Inc., doing business as Anderson Griggs Investments, is a registered investment adviser.  Anderson Griggs only conducts business in states and ...

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Kendall J. Anderson 1 month ago Author's comment

I did not contact Mr. Jeffrey prior to my trip to Columbus. I thought I would have plenty of time when I arrived. But not having participated in this type of competition I did not realize all the preliminary events the organizers had planned. This included a tech inspection that once completed the bike was impounded until the beginning of the competition.

I finished in seventh place overall - later bumped to 6th as one individual rider was disqualified after the finishing verification process. As it has been with all my motorcycle endurance competitions, the competition is difficult, but the memories are wonderful.

Kendall

Kurt Benson 1 month ago Member's comment

Wow, impressive. Thanks for sharing your experience with us.

James Madison 1 month ago Member's comment

Interesting approach and story. Why didn't you end up meeting with Jeffries? Was the competition more than you bargained for? How did it go? I feel like we were left in suspense!