Buttering bread

My father was the quintessential perfectionist. His words of praise, signifying a job well done, were “not bad.” Fortunately my mother made a joke out of all the “not bads,” so I quickly learned to translate “not bad” into “very good.” Not quite the “outstanding” my brother-in-law used to describe the accomplishments of his children but on balance good enough—or, perhaps, not bad.

My father’s perfectionism permeated even seemingly insignificant tasks—buttering bread, for instance. “Take care of the edges,” he said, “and the middle will take care of itself.” He said it not once but every time I put a pat of butter in the middle of a slice of bread and spread outward. These words of wisdom were not original (though at the time I thought they were), but they resonated nonetheless.

Many years later I’ve come to appreciate the wisdom of the bread buttering algorithm. When confronted with a problem our instinct is dig right in and try to get to the heart of the problem. But sometimes the smartest solution is to start poking around at the edges.

Poking around is a slow exploration, looking to discover things that a person on a mission tends to miss. As Kathleen Dean Moore wrote in “Poking Around: The How & The Why”: “[T]he art of poking around means prying at things with the toe of your boot, turning over rocks at the edges of streams, lifting logs to search for snakes or a nest of silky deer mice, and kneeling to examine the tiny bones mixed with fur encased in a predator’s scat. Poking around is more focused than watching, yet less systematic. . . . Unlike hiking, poking around has no set destination. It is more intense than strolling, but more capricious than studying. . . . Poking around is a guaranteed way to learn.”

I stress the notion of poking around because I don’t want the bread buttering algorithm to be translated as “get the entry and the exit right, and the middle will take care of itself.” Not only is this not what I want to say, but, depending on how you interpret it, it’s either false or meaningless.

In investing and trading there are lots of edges to poke around at. There are the small mistakes that reduce profits, there are the tiny advantages that in and of themselves may not make much of a difference but that when combined with some other variable might increase returns. Poke around at those edges, take care of them, and the middle might just take care of itself.