NZ Herald
  • Home
  • Latest news
  • Herald NOW
  • Video
  • New Zealand
  • Sport
  • World
  • Business
  • Entertainment
  • Podcasts
  • Quizzes
  • Opinion
  • Lifestyle
  • Travel
  • Viva
  • Weather

Subscriptions

  • Herald Premium
  • Viva Premium
  • The Listener
  • BusinessDesk

Sections

  • Latest news
  • New Zealand
    • All New Zealand
    • Crime
    • Politics
    • Education
    • Open Justice
    • Scam Update
  • Herald NOW
  • On The Up
  • World
    • All World
    • Australia
    • Asia
    • UK
    • United States
    • Middle East
    • Europe
    • Pacific
  • Business
    • All Business
    • MarketsSharesCurrencyCommoditiesStock TakesCrypto
    • Markets with Madison
    • Media Insider
    • Business analysis
    • Personal financeKiwiSaverInterest ratesTaxInvestment
    • EconomyInflationGDPOfficial cash rateEmployment
    • Small business
    • Business reportsMood of the BoardroomProject AucklandSustainable business and financeCapital markets reportAgribusiness reportInfrastructure reportDynamic business
    • Deloitte Top 200 Awards
    • CompaniesAged CareAgribusinessAirlinesBanking and financeConstructionEnergyFreight and logisticsHealthcareManufacturingMedia and MarketingRetailTelecommunicationsTourism
  • Opinion
    • All Opinion
    • Analysis
    • Editorials
    • Business analysis
    • Premium opinion
    • Letters to the editor
  • Politics
  • Sport
    • All Sport
    • OlympicsParalympics
    • RugbySuper RugbyNPCAll BlacksBlack FernsRugby sevensSchool rugby
    • CricketBlack CapsWhite Ferns
    • Racing
    • NetballSilver Ferns
    • LeagueWarriorsNRL
    • FootballWellington PhoenixAuckland FCAll WhitesFootball FernsEnglish Premier League
    • GolfNZ Open
    • MotorsportFormula 1
    • Boxing
    • UFC
    • BasketballNBABreakersTall BlacksTall Ferns
    • Tennis
    • Cycling
    • Athletics
    • SailingAmerica's CupSailGP
    • Rowing
  • Lifestyle
    • All Lifestyle
    • Viva - Food, fashion & beauty
    • Society Insider
    • Royals
    • Sex & relationships
    • Food & drinkRecipesRecipe collectionsRestaurant reviewsRestaurant bookings
    • Health & wellbeing
    • Fashion & beauty
    • Pets & animals
    • The Selection - Shop the trendsShop fashionShop beautyShop entertainmentShop giftsShop home & living
    • Milford's Investing Place
  • Entertainment
    • All Entertainment
    • TV
    • MoviesMovie reviews
    • MusicMusic reviews
    • BooksBook reviews
    • Culture
    • ReviewsBook reviewsMovie reviewsMusic reviewsRestaurant reviews
  • Travel
    • All Travel
    • News
    • New ZealandNorthlandAucklandWellingtonCanterburyOtago / QueenstownNelson-TasmanBest NZ beaches
    • International travelAustraliaPacific IslandsEuropeUKUSAAfricaAsia
    • Rail holidays
    • Cruise holidays
    • Ski holidays
    • Luxury travel
    • Adventure travel
  • Kāhu Māori news
  • Environment
    • All Environment
    • Our Green Future
  • Talanoa Pacific news
  • Property
    • All Property
    • Property Insider
    • Interest rates tracker
    • Residential property listings
    • Commercial property listings
  • Health
  • Technology
    • All Technology
    • AI
    • Social media
  • Rural
    • All Rural
    • Dairy farming
    • Sheep & beef farming
    • Horticulture
    • Animal health
    • Rural business
    • Rural life
    • Rural technology
    • Opinion
    • Audio & podcasts
  • Weather forecasts
    • All Weather forecasts
    • Kaitaia
    • Whangārei
    • Dargaville
    • Auckland
    • Thames
    • Tauranga
    • Hamilton
    • Whakatāne
    • Rotorua
    • Tokoroa
    • Te Kuiti
    • Taumaranui
    • Taupō
    • Gisborne
    • New Plymouth
    • Napier
    • Hastings
    • Dannevirke
    • Whanganui
    • Palmerston North
    • Levin
    • Paraparaumu
    • Masterton
    • Wellington
    • Motueka
    • Nelson
    • Blenheim
    • Westport
    • Reefton
    • Kaikōura
    • Greymouth
    • Hokitika
    • Christchurch
    • Ashburton
    • Timaru
    • Wānaka
    • Oamaru
    • Queenstown
    • Dunedin
    • Gore
    • Invercargill
  • Meet the journalists
  • Promotions & competitions
  • OneRoof property listings
  • Driven car news

Puzzles & Quizzes

  • Puzzles
    • All Puzzles
    • Sudoku
    • Code Cracker
    • Crosswords
    • Cryptic crossword
    • Wordsearch
  • Quizzes
    • All Quizzes
    • Morning quiz
    • Afternoon quiz
    • Sports quiz

Regions

  • Northland
    • All Northland
    • Far North
    • Kaitaia
    • Kerikeri
    • Kaikohe
    • Bay of Islands
    • Whangarei
    • Dargaville
    • Kaipara
    • Mangawhai
  • Auckland
  • Waikato
    • All Waikato
    • Hamilton
    • Coromandel & Hauraki
    • Matamata & Piako
    • Cambridge
    • Te Awamutu
    • Tokoroa & South Waikato
    • Taupō & Tūrangi
  • Bay of Plenty
    • All Bay of Plenty
    • Katikati
    • Tauranga
    • Mount Maunganui
    • Pāpāmoa
    • Te Puke
    • Whakatāne
  • Rotorua
  • Hawke's Bay
    • All Hawke's Bay
    • Napier
    • Hastings
    • Havelock North
    • Central Hawke's Bay
    • Wairoa
  • Taranaki
    • All Taranaki
    • Stratford
    • New Plymouth
    • Hāwera
  • Manawatū - Whanganui
    • All Manawatū - Whanganui
    • Whanganui
    • Palmerston North
    • Manawatū
    • Tararua
    • Horowhenua
  • Wellington
    • All Wellington
    • Kapiti
    • Wairarapa
    • Upper Hutt
    • Lower Hutt
  • Nelson & Tasman
    • All Nelson & Tasman
    • Motueka
    • Nelson
    • Tasman
  • Marlborough
  • West Coast
  • Canterbury
    • All Canterbury
    • Kaikōura
    • Christchurch
    • Ashburton
    • Timaru
  • Otago
    • All Otago
    • Oamaru
    • Dunedin
    • Balclutha
    • Alexandra
    • Queenstown
    • Wanaka
  • Southland
    • All Southland
    • Invercargill
    • Gore
    • Stewart Island
  • Gisborne

Media

  • Video
    • All Video
    • NZ news video
    • Herald NOW
    • Business news video
    • Politics news video
    • Sport video
    • World news video
    • Lifestyle video
    • Entertainment video
    • Travel video
    • Markets with Madison
    • Kea Kids news
  • Podcasts
    • All Podcasts
    • The Front Page
    • On the Tiles
    • Ask me Anything
    • The Little Things
  • Cartoons
  • Photo galleries
  • Today's Paper - E-editions
  • Photo sales
  • Classifieds

NZME Network

  • Advertise with NZME
  • OneRoof
  • Driven Car Guide
  • BusinessDesk
  • Newstalk ZB
  • Sunlive
  • ZM
  • The Hits
  • Coast
  • Radio Hauraki
  • The Alternative Commentary Collective
  • Gold
  • Flava
  • iHeart Radio
  • Hokonui
  • Radio Wanaka
  • iHeartCountry New Zealand
  • Restaurant Hub
  • NZME Events

SubscribeSign In
Advertisement
Advertise with NZME.
Home / New Zealand

Mark Lister: Pessimists sound smart, optimists make money

By Mark Lister
Rotorua Daily Post·
30 Jun, 2024 04:00 PM4 mins to read

Subscribe to listen

Access to Herald Premium articles require a Premium subscription. Subscribe now to listen.
Already a subscriber?  Sign in here

Listening to articles is free for open-access content—explore other articles or learn more about text-to-speech.
‌

Subscriber benefit

The ability to gift paywall-free articles is a subscriber only benefit. See more offers by clicking the button below.

Already a subscriber?  Sign in here
Save

    Share this article

    Reminder, this is a Premium article and requires a subscription to read.

When it comes to investing being an optimist pays off, writes Mark Lister. Photo / 123RF
When it comes to investing being an optimist pays off, writes Mark Lister. Photo / 123RF

When it comes to investing being an optimist pays off, writes Mark Lister. Photo / 123RF

Mark Lister is Investment Director at Craigs Investment Partners.

OPINION

Gloom seems to be what sells these days.

There was a study last year which found that negative words in news headlines increased consumption and click-through rates, while positive words decreased them.

When it comes to the world of economics and investing, negative opinions also get more attention.

Start your day in the know

Get the latest headlines straight to your inbox.
Please email me competitions, offers and other updates. You can stop these at any time.
By signing up for this newsletter, you agree to NZME’s Terms of Use and Privacy Policy.
Advertisement
Advertise with NZME.

Nobody wants to read “Steady as she goes, just stay the course” but “Here’s why a crash is coming” will top the charts.

Not only will negativity get you noticed, but it can also be safer to err on the side of caution.

Focusing on the potential risks and things that could go wrong seems to add to one’s credibility.

Advertisement
Advertise with NZME.

In contrast, those with a glass half full view can be mistaken for being overly relaxed.

After all, could they really have done the work if they haven’t unearthed a looming crisis?

Financial forecasters often have more to lose from being too bullish, which means the path of pessimism can sometimes be the safer one.

If they’re pessimistic and wrong, people are pleasantly surprised things turned out better than expected, while grateful they were warned anyway.

But if they’re optimistic and wrong, people end up out of pocket and their carefree attitude can get the blame.

There’s nothing wrong with being mindful of risks and let’s be honest, at any given time the list of concerning issues is a lengthy one.

However, when it comes to investing being an optimist pays off.

The S&P 500 index in the US has (including dividends that were reinvested, rather than spent) delivered an annual return of 10.8% over the past 30 years.

Advertisement
Advertise with NZME.

If you’d invested $100 in 1994 and left it alone, it would’ve grown more than 20-fold since then and you’d have over $2000.

New Zealand shares have returned 8.5% annually over that period, while the Australian market has delivered 9.1%.

Now consider everything the world has thrown at investors over that period.

There’s been the September 11 terrorist attacks, numerous wars, a US housing crash, a global pandemic, and three recessions.

I can point to 14 occasions where the S&P 500 fell by more than 10%, including four instances where it was down more than 20%.

Two of those times the market was cut in half, sinking close to 50%.

There have been plenty of reasons to sit fearfully on the sidelines, in case one of the many potential risks became a reality.

In fact, some of them did, yet the market still has a flawless track record of recovering and moving on to bigger and better things.

Discover more

  • Mark Lister: Why farmers make good investors...
  • Mark Lister: Is it time for more asset sales? - NZ ...
  • Mark Lister: Is the NZX headed for an unwanted three-peat? ...
  • Mark Lister: The shifting sands of central bank outlooks ...

Pessimistic investors aren’t without options, mind you.

Cash in the bank hasn’t lost a cent at any point over the past three decades, no matter what’s been going on in the world.

The return of 4.9% per annum is fairly subdued though, and $100 invested in 1994 would’ve only grown four-fold (assuming you reinvested all the income) to a little over $400.

Not only has the anxious pessimist spent a lot of energy worrying about what might go wrong (but probably won’t), they’ve also found themselves 80% less wealthy than the more relaxed optimist.

US tech investor Nat Friedman famously said “pessimists sound smart, optimists make money”.

He wasn’t referring to financial markets, but there’s something we can learn from that as investors.

A healthy dose of scepticism can keep us on the straight and narrow, but too much of it can hold us back from making progress or taking opportunities.

Don’t write off the optimists just because they aren’t panicking enough. They might have more common sense than you think, and maybe even a longer-term view.

The information in this article is provided for information only, is intended to be general in nature, and does not take into account your financial situation, objectives, goals, or risk tolerance. Before making any investment decision Craigs Investment Partners recommends you contact an investment adviser.


Subscriber benefit

The ability to gift paywall-free articles is a subscriber only benefit. See more offers by clicking the button below.

Already a subscriber?  Sign in here
Save

    Share this article

    Reminder, this is a Premium article and requires a subscription to read.

Latest from New Zealand

live
New Zealand

Slips, flooding, evacuations hit top of south; speed limits on Harbour Bridge

26 Jun 07:14 PM
New Zealand

Explainer: What to know about melatonin, ADHD medicine and medicinal psilocybin

26 Jun 07:00 PM
New Zealand

Finished: 25 new Kāinga Ora homes ready for Rotorua families

26 Jun 06:01 PM

Kaibosh gets a clean-energy boost in the fight against food waste

sponsored
Advertisement
Advertise with NZME.
Recommended for you
Halter CEO's inside secrets to raising capital
Markets with Madison

Halter CEO's inside secrets to raising capital

26 Jun 07:00 PM
Explainer: What to know about melatonin, ADHD medicine and medicinal psilocybin
New Zealand

Explainer: What to know about melatonin, ADHD medicine and medicinal psilocybin

26 Jun 07:00 PM
What do the ultra-rich want on holiday? These travel concierges know
Travel

What do the ultra-rich want on holiday? These travel concierges know

26 Jun 07:00 PM
Is your ski field open? What to know about the snow ahead of school holidays
Travel news

Is your ski field open? What to know about the snow ahead of school holidays

26 Jun 07:00 PM
Lorde’s new album comes out today, here’s everything we know about Virgin
Entertainment

Lorde’s new album comes out today, here’s everything we know about Virgin

26 Jun 06:56 PM

Latest from New Zealand

Slips, flooding, evacuations hit top of south; speed limits on Harbour Bridge
live

Slips, flooding, evacuations hit top of south; speed limits on Harbour Bridge

26 Jun 07:14 PM

Severe weather hits as school holidays begin, causing concern nationwide.

Explainer: What to know about melatonin, ADHD medicine and medicinal psilocybin

Explainer: What to know about melatonin, ADHD medicine and medicinal psilocybin

26 Jun 07:00 PM
Finished: 25 new Kāinga Ora homes ready for Rotorua families

Finished: 25 new Kāinga Ora homes ready for Rotorua families

26 Jun 06:01 PM
Northland teen wins $25,000 education scholarship

Northland teen wins $25,000 education scholarship

26 Jun 06:00 PM
Engage and explore one of the most remote places on Earth in comfort and style
sponsored

Engage and explore one of the most remote places on Earth in comfort and style

NZ Herald
  • About NZ Herald
  • Meet the journalists
  • Newsletters
  • Classifieds
  • Help & support
  • Contact us
  • House rules
  • Privacy Policy
  • Terms of use
  • Competition terms & conditions
  • Our use of AI
Subscriber Services
  • NZ Herald e-editions
  • Daily puzzles & quizzes
  • Manage your digital subscription
  • Manage your print subscription
  • Subscribe to the NZ Herald newspaper
  • Subscribe to Herald Premium
  • Gift a subscription
  • Subscriber FAQs
  • Subscription terms & conditions
  • Promotions and subscriber benefits
NZME Network
  • The New Zealand Herald
  • The Northland Age
  • The Northern Advocate
  • Waikato Herald
  • Bay of Plenty Times
  • Rotorua Daily Post
  • Hawke's Bay Today
  • Whanganui Chronicle
  • Viva
  • NZ Listener
  • Newstalk ZB
  • BusinessDesk
  • OneRoof
  • Driven Car Guide
  • iHeart Radio
  • Restaurant Hub
NZME
  • About NZME
  • NZME careers
  • Advertise with NZME
  • Digital self-service advertising
  • Book your classified ad
  • Photo sales
  • NZME Events
  • © Copyright 2025 NZME Publishing Limited
TOP
search by queryly Advanced Search