ROC Your World

ROC your world...ROC is not a typo, though, just ask my kids, I am THE worst speller. ROC stands for rate-of-change. In the context of a moving car, ROC is not the speed but rather whether the car is accelerating or decelerating (the CHANGE in speed).

ROC is critical in investing (I was an analyst and portfolio manager for the bulk of my working life). In the context of making investing decisions, ROC means that what is critical is not whether a data point is GOOD or BAD, but rather whether it is getting BETTER or WORSE. Are things getting better or worse? Are things improving? Is the company's revenue or profitability accelerating? Is the macro economic condition getting worse?

Prior to being an analyst, I was an engineer. Engineers are process-oriented and what keeps engineers employed is an effort towards continuous improvement (e.g., a more efficient engine, less emissions, a faster device, more storage, etc.). So, I've had 'improvement' on the brain for a long time.

Finally, what does this have to do with financial literacy? Well recall, or realize, my framework goes beyond 'traditional' financial literacy topics (e.g., boring budgets, balancing a checkbook, etc.). To me, it is about broad life skills and becoming future-ready for a demanding world. Success ends up being a personal responsibility and very much about having specific goals and a personal process or roadmap to follow.

It is only logical, and makes the effort worth it, to be striving to get better.

Better with your money habits.

Better at communicating with your kids.

Better working within your community.

Strive for constant improvement!