It may have taken a little longer than usual but a familiar sound from sporting summers past is starting to reverberate again. Two efficient 1-0 wins either side of a 0-0 draw with Scotland may not have set the pulses of many England fans racing but as Gareth Southgate’s team prepare for today’s round-of-16 game with – who else? – Germany, the chorus is growing louder: “It’s coming home, it’s coming home …”
Like the controls of a shower in a two-star hotel, it doesn’t take very much to switch the emotions surrounding the national football team from one extreme of temperature to the other – “It’s scalding hot, it’s freezing cold …” as it were. And of course ‘Three Lions’ does tap into that cycle of emotion – wearily familiar to England football fans – that runs from artificially low expectations to unrealistically high ones. And back again …
Whenever England qualify for the Euros or a World Cup, this happens on a fairly predictable two-year cycle (pandemic-inspired delays excepted). And a similar – if perhaps less rigidly timetabled – phenomenon can be seen in the stockmarket where, over time, investors tend to work through a range of different emotions.
It’s coming home, it’s coming home, it’s coming …
Euphoria: This is the best company I have ever bought – great numbers, great barriers to entry, just great.
Everyone seems to know the score, they’ve seen it all before … They just know, they’re so sure …
Denial: The shares are falling, you say? Then the market’s wrong – there is no way I’m selling out of this.
That England’s gonna, throw it away, gonna blow it away but I know they can play.
Fear: Hang on, now I’m getting nervous. Maybe I’ve got this wrong. Oh no – I just doubled my position.
So many jokes, so many sneers …
Despair: People will be asking me why I’m now the biggest holder of this stock. I’ve made a terrible mistake
But all those ‘oh so near’s …
Capitulation: But it looked so great. What can I have been thinking? Time to sell. Maybe no-one will notice.
When you’re down, through the years.
Disinterest: The shares are rising, you say? Then the market’s wrong – there is no way I’m buying back in.
But I still see that tackle by Moore … and when Lineker scored …
Acceptance: Actually, management do seem to have fixed things. Maybe it’s time I got back on the horse.
Bobby belting the ball … and Nobby dancing
Excitement: What a great move. I’ll make all my losses back. This is the best company I have ever bought …
I know that was then … but it could be again …
It’s coming home, it’s coming home, it’s coming …
The world is continuously changing but one thing does remain constant – human beings. Markets are cheap when we are fearful; and they are expensive when we are greedy. However England’s fortunes in this tournament – or any other – play out, in the world of investing, it turns out we are systematically exploitable. And value investing is the system.
Andy Evans is an equity value fund manager at Schroders and a blogger on The Value Perspective
