The Art of War by Sun Tzu

📚 arvy's Book Club

arvy's Teaser: A 2,500-year-old military manual sits on the desks of Wall Street traders, Silicon Valley CEOs, and professional sports coaches. Why? Because Sun Tzu's principles — know yourself, pick your battles, win before you fight — are the oldest surviving framework for strategic thinking. And they apply to investing more directly than most finance books do. Here's what a Chinese general from 500 BC can teach you about building wealth.

The Book in 60 Seconds

The Art of War (~5th century BC) by Sun Tzu is the most influential strategy text ever written. In 13 short chapters, Sun Tzu lays out principles for winning conflicts — not through brute force, but through intelligence, preparation, and psychological advantage. Originally written for military commanders, its principles have been adopted by business leaders, investors, and anyone operating in competitive environments.

Sun Tzu · ~500 BC · Strategy, Leadership & Competition
~100 pages · Read in a single sitting

Idea 1: The Best Victory Is the One Won Before the Fight Begins

Sun Tzu's most famous principle: the supreme art of war is to subdue the enemy without fighting. The ideal victory requires no battle at all — it comes from superior preparation, positioning, and intelligence that makes the outcome inevitable before contact.

Translated to investing: the best investment decisions are made before you invest. They happen in the research, the system design, the asset allocation. By the time you press "buy," the outcome should already be weighted in your favour — because you've chosen quality companies, diversified properly, and designed a system that removes emotional decision-making.

Victorious warriors win first and then go to war, while defeated warriors go to war first and then seek to win.

Idea 2: Know Yourself and Know the Terrain

Sun Tzu's second principle: "If you know the enemy and know yourself, you need not fear the result of a hundred battles." But he adds a crucial nuance most people miss: knowing yourself is more important than knowing the enemy. A general who understands his own strengths, weaknesses, and limitations can avoid catastrophic mistakes — even without perfect intelligence about the opponent.

For investors, the "enemy" isn't other investors or the market. The enemy is your own behaviour. Panic-selling, FOMO buying, checking your portfolio daily, overreacting to headlines — these are the battles you lose against yourself. Sun Tzu would say: master yourself first, and the market becomes manageable.

Idea 3: Avoid Prolonged Conflict — Patience Is Not Passivity

Sun Tzu warns repeatedly: prolonged conflict drains resources and morale. The best campaigns are efficient — quick, decisive, and resource-preserving. He advises against drawn-out engagements that consume more than they win.

The investing translation: don't trade. Every transaction is a "battle" — it costs fees, taxes, and emotional energy. The more you trade, the more you bleed. The most successful long-term investors do the opposite: they invest once, systematically, and then do nothing for years. The "prolonged conflict" Sun Tzu warns against is the constant buying and selling that active traders engage in — and that costs most of them their returns.

What This Means for Swiss Investors

arvy's Take

What holds up: 2,500 years and still relevant — that says everything. Sun Tzu's principles are so foundational that every modern strategy framework (Porter's Five Forces, game theory, behavioural economics) rests on ideas he articulated first. For investors, the book is a masterclass in discipline, self-knowledge, and the counterintuitive power of doing less.

What's missing: It's a military text, not a finance book — the investment connections need to be drawn by the reader. The writing is aphoristic (short statements, no explanation), which makes it quotable but sometimes vague. And many translations vary significantly, so the version you read matters.

What we'd add: Sun Tzu + Morgan Housel is the perfect combination. Sun Tzu gives you the strategic framework (prepare, know yourself, avoid unnecessary action). Housel gives you the financial application (behaviour beats intelligence, compounding needs decades, wealth is invisible). Read both. Then automate your savings plan and stop fighting the market.

3 Sentences to Remember

1. Win before you fight. The best investment decisions are made in the system design, not in the moment.

2. Your biggest enemy in investing is yourself — your emotions, your impatience, your reactions.

3. The investor who acts least often wins most often. Set up the system, then do nothing.

Buy the book

English (Amazon) · Deutsch (Amazon)

Also in Book Club: Psychology of Money → · Best Trading Books →

This article was written by Thierry Borgeat, Co-Founder of arvy, and reviewed by Patrick Rissi, CFA, and Florian Jauch, CFA.

Disclaimer: This article is for general informational purposes only and does not constitute personal investment advice. Amazon links are affiliate links. arvy is a FINMA-supervised asset manager.