If you’ve ever watched a TV quiz show called “Jeopardy,” your reaction might have been similar to mine.  “Wow, how do they know that?  They’re really bright!” Endless facts.  Endless “knowledge” about things that I, for one, know nothing about.  But it is not knowledge; it’s about an ability to retain information.  That’s very different from having knowledge of a subject.  With knowledge, one has the ability to use information.  It is the essence of the quote, “May the force be with you” from the Star Wars epic film saga.

Journalist Bill Moyers realized this when he interviewed Professor Joseph Campbell in 1998 for Public Broadcasting.   The interview lasted six hours and was subsequently made into six one-hour specials.  Campbell, an expert in mythology, had previously written a book titled The Hero with a Thousand Faces.  It detailed how all mythology told the same story.  The hero was always an orphan (so he wouldn’t be distracted by family life) who would leave his village and go up a mountain.  There God would speak to him and he would bring back God’s message to the village.  

The same story was told throughout time, in all cultures, in all parts of the world.  It is the story of Christ, Mohammed, Confucius, Moses, Buddha et al.  Later, it became the same story culturally – in movie and comic book form - for Superman, Batman, Harry potter, Wonder woman, Spider Man etc.  All were orphans with the same purpose.   Joseph Campbell was knowledgeable not because he knew about a thousand prophets, though that’s hard to do, but because he constructed a knowledgeable concept from it.  The human need for a universal myth.  The TV series was one of the most popular ever shown on public television.

A “eureka” moment occurs when information enables us to then create knowledge.  It’s bringing information together so we can have an understanding of whatever the subject we’re focused on.  Einstein, experienced this with his revelation of E=MC2.  This distinction between information and knowledge struck me recently when I purchased a book called The Man Who Solved the Market by Gregory Zuckerman.  It’s the story of another professor, Jim Simons (M.I.T.), who had started a quantitative hedge fund called Renaissance Technology.  His hedge fund made him one of the richest men in the investment business with wealth estimated at 21.6 billion!  Was he knowledgeable about the investment world?  Not at all.  By background, he was an astrophysicist.

Simons was a pioneer in using mathematical formulas for quantitative “investing.” But trading is not investing; investing is the outlay of an asset (in this case money) in the hope of a greater payoff in the future.  Human beings do not measure the future in milliseconds. Only, transactional quants do.  They use fast computers and software designed to beat those whose information flow is slower.  The transition of the stock exchange to a privatized for profit computerized market, had everything to do with his wealth accumulation.  This transition enabled profit to go to those with the fastest trading information.  One could say he had a knowledge of computers, but that is not investment knowledge.  In fact, it invalidates the premise of the book; The Man Who SOLVED the Market.

All active managers I’ve known have been voracious readers searching for information.  Information which can lead them to investable knowledge.  Peter Lynch, as a young man, used to take a bus in and out of Boston so he could read during his commute.  Later, Fidelity sent him a limousine.  Unlike the quants, speed of execution was never a factor in his investment success.  It was knowledge … and judgement.  Too often, information is conflated as knowledge.

We all have information that comes our way, but it does not become knowledge until we have the realization of how to implement it in a meaningful way.  George Lucas, the “creator” of the Star Wars saga, studied Joseph Campbell’s writing years before putting it to film.  Lucas regarded Campbell as his “Yoda.” Yoda was one of the most powerful members of the Jedi Order.  He was a teacher to Luke Skywalker, not of information, but of all Jedi knowledge. 

-Francis Patrick Boland