In the last several years, there has been an explosion of interest in meditation by the business community. However, what most in our industry don’t realize is that meditation provides unique benefits that directly address many of the obstacles we face daily. But just who in the investment industry meditates? Actually, more than you think.

Several well-known investors are public advocates for the practice of meditation. These include Bridgewater Associates’ Ray Dalio, Tudor Investment Corp.’s Paul Tudor Jones II, and Fortress Investment Group’s Michael Novogratz. Additionally, BlackRock, Deutsche Bank, and Goldman Sachs each have meditation programs in place for their employees. Even important business schools—including Georgetown University, New York University, Claremont Graduate University in California, and Oxford University—embrace meditation for their students.

A 2014 global CFA Institute survey found that 59 percent of all members wanted the Institute to develop a meditation program and that approximately 16 percent of all members currently do meditate. A follow-up survey of the meditators found none of them knew of others in the finance industry who meditated. Chances are, then, one of your co-workers meditates and you just don’t know it.

Meditation should interest investment professionals, in particular, because we face an enormous amount of stress, have an unceasing quest for alpha, have difficulty overcoming behavioural biases, and face ethical dilemmas. Science demonstrates that meditation is a potent antidote to each of these obstacles. What’s more, it’s portable—and free!

Stress Relief – Stress relief is the most widely known benefit of meditation and has been exhaustively tested in this context, with several thousand research papers published in peer-reviewed journals. A recent massive meta-analysis (Goyal et al., 2014) found significant evidence that meditation lessened anxiety, depression, and pain. Stress is implicated in cardiovascular disease, osteoarthritis and osteoporosis, Alzheimer’s disease, stroke, and Type 2 diabetes—all big killers. Not only are meditators able to reduce their stress, they’re able to alter the functioning of their own DNA (Jacobs et al., 2012, among others).

Increased Mental Functioning – If you believe alpha wave generation is doing something your peers are not, then generating alpha waves requires an increase in your creativity, which is also doing something others are not. Meditation has been scientifically demonstrated to increase your creativity (Ho, 2010 and Colzato et al., 2012). Additionally, meditators have been shown to have better memories (Chambers et al., 2008), better state awareness (Lykins & Baer, 2009), and better decision-making skills (Schneider et al., 2010).

Overcoming Behavioural Biases – With several Nobel Prizes awarded to behavioural economists for their work in identifying persistent human biases, you’d think each of us would be improving our investment performance. But, sadly, behavioural finance is essentially a diagnosis without a prescription. This is confirmed by a 2014 survey of CFA Institute Financial NewsBrief readers. It found that 56 percent had failed to incorporate behavioural finance successfully into their practice of finance. In fact, at CFA Institute’s 2012 annual conference, when asked what to do to overcome behavioural biases, the grandfather of behavioural economics, Daniel Kahneman, said, “Very little. I have 40 years of experience with this, and I still commit these errors. Knowing the errors is not the recipe to avoiding them.”

Yet meditators are even able to overcome racism and ageism (Lueke & Gibson, 2014). Furthermore, several direct tests of meditation’s ability to overcome the biases identified by behavioural economics have been conducted, and it was found to improve performance tremendously (Kirk et al., 2011 and Kirk et al., 2014).

Increasing Ethics – Researchers such as Dan Ariely have demonstrated that there are few egregious liars and cheaters in society—see The (Honest) Truth About Dishonesty. Instead, most of us cheat just a little, and, in the aggregate, this amounts to a far greater problem than that created by the proverbial “bad apples.” Our business frequently presents us with ethical dilemmas, and the usual way of handling these dilemmas is codes of ethics. Sadly, codes of ethics are shown to have limited benefit in preventing the very violations they’re designed to prevent (Schneider et al., 2010). Yet meditators are shown to behave more ethically, not because they’re told they should, but because they want to (Schneider et al., 2010; Ruedy & Schweitzer, 2010; and Lutz et al., 2008).

Given the many proven benefits of meditation for investment professionals—not to mention its exceptionally low cost—the question isn’t Why aren’t you meditating? it’s When will you start? 

MYTHS OF MEDITATION

One reason why meditation carried a stigma for so many years is the popular mythology surrounding the practice. By far the greatest myth is that meditation is only for shaven-headed cave dwellers. But actually, the states of consciousness achieved while meditating (as measured by brain waves) are innate to human consciousness. Each of us has experienced these states, but few of us have developed the focused awareness necessary to achieve them at will—despite their benefits. Meditation, therefore, can be practised in a secular fashion, divorced from any religious trappings. So there’s no need to shave your head!

Another common misperception is that there’s only one way to meditate. In fact, there are hundreds of different meditation styles and practices. But don’t worry; by focusing on the mental and physical benefits of individual meditation, the majority of meditation styles can be reduced to just four: focused awareness, open monitoring, visualization, and compassion.

Finally, if you’ve heard about meditation, or have tried it, you likely believe it’s hard to do. Nothing could be further from the truth. Just as walking is innate in humans, so are the states of consciousness attained by a meditation practice. But as with walking, it takes time and practice to learn. Because our modern culture is obsessed with the quality of our intelligence, meditation can make many of us feel foolish as it quickly demonstrates that most of us can’t control our thoughts. But, with practice and a sense of exploration and fun, it gets easier.

If you would like more information on meditation for investment professionals, join the new LinkedIn CFA Institute Members Meditation group at linkedin.com/groups/6983329.

MEDITATION PROGRAM ON THE WAY

CFA Institute has spent the last three years comprehensively researching and developing a program for its members. Look for it on the website later this year.