What Leonardo Can Teach us About Investing

What Leonardo Can Teach us About Investing

Published on:
June 29, 2019
Written on:

About The Author

Noam Ganel, CFA is the founder of Pen&Paper, a value-oriented, contrary-minded journal of the financial markets. Noam worked as a Vice President in Capital Markets at Silvergate (publicly traded on NYSE under SI since Nov-2019.) At SI, which he joined in 2010, Noam was responsible for advisory services to family offices,  private companies, and financial advisors.

Three ways to get inspiration from investment managers: first is to follow what current investment managers are doing. For example, listen to Mohnish Pabrai and you will be inspired to cut management fees to zero and to free your calendar as, according to Pabri, "Meeting humans can be very distracting and time consuming."

Second way is to go back in time. Perhaps, a few several decades ago when Warren Buffett was still an unknown investment manager with a last name no one knew how to correctly spell. Students of finance who follow the second way read Security Analysis by Benjamin Graham or The Art of Speculation by Philip L. Carrett.

The Third way, also the subject of this essay, is to find inspiration in great individuals who lived at times when stock markets had yet to be invented. These great individuals were not stock investors. But they have much to inspire us about stock investing.

Varied skills

Born in the 15th century, Leonardo Da Vinci was such individual. Da Vinci worked as both a painter and engineer for Louis XII. At the age of 37, he studied anatomy and architecture, worked on military strategies for Cesare Borgia (who was a major inspiration for the The Prince by Machiavelli) and attempted to invent a flying machine. At a later age, he dissected bodies in his spare time. In short, he was a Polymath.

The 21th century stock investor needs to hone varied skills, too. Investing time in understanding a few concepts in psychology, statistics (probability theory and statistical analysis) and biology will serve investors better than if they were to read and follow current “wisdom” of large money managers (Principles by Ray Dalio is a prime example).  

Goal (not money)

According to his latest biographer, Walter Isaacson, Da Vinci was never motivated by wealth or material possessions. Da Vinci decried "men who desire nothing but material riches and are absolutely devoid of the desire for wisdom, which is the sustenance and truly dependable wealth of the mind."

And just as Da Vinci did not paint so that someone would buy the painting from him, stock investors should have other reasons to study stock markets than money-making. I believe that for Da Vinci the stock market would be a playground to test out ideas about life and about our mindset. For example, he would study cryptocurrency, not to determine the value of bitcoin (if there is one) but to understand how and in what way the world may benefit from digital currency.


In Isaacson’s biography of Da Vinci, he brings a fascinating story. How Da Vinci was fascinated by the tongue of a woodpecker as it could extend more than three times the length of its bill. He also studied optics and how our muscles worked so that he could have a dimension of movement and depth in his art. "He could stare at a wall," wrote Isaacson, "and observe with precision the variations of each stone and other factual details." Da Vinci, in short, was a curious individual.

That sense of wonder is often missing from the art of stock investing. In investing, a doctrine where the right hemisphere is praised, and the left hemisphere ignored, a sense of curiosity never appears to be a requirement for successful investing.  

But it is curiosity that will allow you to find the next investment opportunity. It is curiosity that will make you attractive to potential investors in your fund, and it is genuine curiosity, I believe, that makes successful investors wake up in the morning.


"Though I have no power to quote from authors as they have," said Da Vinci, "I shall rely on a far more worthy thing – on experience." Da Vinci was autodidact that thought experience to be the best teacher.  

Indeed, the lessons I learned about stocks did not come from books but from actual buying stocks. As Walter Scholls, the fame value-investor, once said, "you never know a stock until you own it." (You can read about his wisdom in The Walter Schloss Archive.) 

Another reason why experience triumphs theory is that stock markets change. By the time a book is written about a certain strategy, it is likely not relevant any more. Besides, I am wary of authors who write of stock investment ideas in general. Why would anyone give up profits?  

Latticework of mental models

Da Vinci used knowledge of how blood circulates to think of ideas how to circumvent waste. He studied the neck muscles so that he could paint real facial expressions. He had an uncanny ability to not only think of novel ideas - a mechanical device that will fly us, for example - but an ability to draw conclusions and analogies from different fields.  

Another way to understand how latticework may affect our thinking is by comparing Ginevra Benci and Mona Lisa, two figures that Da Vinci had painted. As Isaacson wrote:

 Ginevra Benci
At age 16 Leonardo's Ginevra Benci
"Ginevra Benci was made by a young artist with astonishing skills of observation. The Mona Lisa is the work of a man who had used those skills to immerse himself in a lifetime of intellectual passions."
Mona Lisa
At age 51, Leonardo's Mona Lisa

Latticework is one of the most important skills you can hone as an investor. "What you need is a latticework of mental models in your head,” said Charlie Munger in Poor Charlie’s Almanack. "And, with that system, things gradually get to fit together in a way that enhances cognition."


Most great individuals were not stock pickers. Yet they have much to teach us about stocks and about our approach to life. In this article, I argue that inspiration from great individuals will serve us well. Yet the idea was not originally mine. Guess who inspired Charlie Munger?

Two great individuals: Cato the Great and Benjamin Franklin.

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