The Cheesecake Factory is a US chain restaurant with a 21-page menu. Diners can choose between more than 250 options. The restaurant prides itself on making each dish from scratch. As you can imagine that takes a large kitchen staff.

Each day there are between 60 and 100 people who work in the kitchen with each chef responsible for overseeing the production of 30 menu items. The Nashville branch of the Cheesecake Factory has 18,000 kilos of ingredients delivered per week. It is an impressive logistical achievement.

On a trip to Japan in April I went to Sushi Kobikicho Tomoki for a 24-course omakase. There is no menu and you eat the fish that is in season. The meal was prepared and served by chef Kobikicho Tomoki, his wife and a dishwasher.

These are two very different experiences. At least I think they are – I’m yet to grace any of the 215 Cheesecake Factory locations.

There is a point to my restaurant juxtaposition. The difference between producing food at the Cheesecake Factory and Sushi Kobikicho Tomoki is the difference between mass production and a craft.

This doesn’t make one good and the other bad. But if you want to be successful in either kitchen you need to be clear about what you are doing – practicing a craft or working the assembly line.

I’ve been thinking a lot about the term craft. I wrote an article last week and referred to investing as a craft. Several readers disagreed by pointing out that all it takes to be successful is dollar cost averaging into a broad-based index fund for the next few decades. They view investing as mass production. That isn’t how I see it.

Is investing a craft?

A broad-based index fund is an investment. And there is a significant amount of research showing the merits of this approach.

But there is a big difference between an investment and investing. The craft isn’t what you buy – it is the process you go through to build wealth. That is investing.

A craft requires judgement derived from knowledge and experience. It requires careful and persistent execution.

Building wealth takes the foresight and discipline needed to save money over decades.

It takes patience so that compounding can do its work.

Building wealth requires the emotional fortitude to not panic in a bear market.

It takes conviction to stick to the same strategy when some other investment will always perform better over the short term – especially if you use a broad-based index fund.

You must ignore the naysayers and resist the compelling pitches for alternate approaches.

Final thoughts

Working in the kitchen of the Cheesecake Factory requires basic culinary skills and the ability to follow a recipe. You need to know your role in a crowded kitchen and execute the same tasks repeatedly. Each staff member is part of an assembly line. That is how mass production works.

Chef Kobikicho Tomoki trained for ten years before opening his own restaurant. Four of those years were spent learning to make rice. Once the restaurant opened it took twelve years to be recognized by Michelin.

This seems like a lot of work to cut a piece of fish and stick it on rice. But what sets a craft apart is how hard it is to do something well. Just dollar cost average into an index fund over decades is easy to say and hard to do.

I’ve never seen a study that suggests the average person is good at investing.

Dalbar and J.P. Morgan looked at the average performance of individual investors in the US between 1998 and 2017. They estimated that the average investor achieved a 2.60% return per year when the average balanced fund returned 6.80%.

Morningstar shows a persistent gap between the returns of investments and the returns investors achieve. This isn’t about what is in your portfolio – it is about you.

Call investing whatever you want. Just don’t pretend it is easy.