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The lesson of Loki? Trade less

Going back as far as the Norse gods, the market has tricked investors into making rash decisions

The pages of the Financial Times are not usually a place for legends about ancient gods, but perhaps I can be indulged in sharing one with a lesson to teach us all.

More than a century ago, Odin, All-father, greatest of the Norse gods, went to his wayward fellow god Loki, and put him in charge of the stock market. Odin told Loki that he could do whatever he wanted, on condition that across each and every 30-year period, he ensured that the market would offer average annual returns between 7 and 11 per cent. If he flouted this rule, Odin would tie Loki under a serpent whose fangs would drip poison into Loki’s eyes from now until Ragnarök.

Loki is notoriously malevolent, and no doubt would love to take the wealth of retail investors and set it on fire, if he could. But when faced with such a — shall we say binding? — constraint, what damage could he really do?

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