One of my favourite historical figures is Emperor Justinian I who ruled as the Byzantine (Eastern Roman) Emperor from 527 to 565 CE. Justinian (sometimes called Justinian the Great) had an ambitious goal of reconquering all lost Roman territory and restoring the glory of the empire.

In this venture he was wildly successful, at least initially. While he did not lead the military campaigns personally, his able generals reconquered North Africa, the Iberian Peninsula and most prominently, most of Italy. Justinian the Great was able to bring Rome back into the fold of the Roman Empire after 50 years of occupation by the Ostrogoths. However, financing these wars was a huge drain on Byzantium’s coffers and Justinian had to tax his people heavily. This resulted in him becoming very unpopular and led to riots and destruction of property in his capital of Constantinople. The empire could not hold on to the reconquered territory and his campaigns in Italy severely damaged what was left of the city of Rome.

Some historians like Procopius, are highly critical of Justinian and his wife and rumoured co-ruler, Theodora. However, as a lay person, I cannot help but be fascinated by the accomplishments of the emperor and his bold project. What I will criticise Justinian for is his failure to understand that the nature of the Roman empire had fundamentally changed with the fall of the Western part of the empire and that seeking to recapture cities he could not hope to keep would only weaken the territory he already controlled.

Justinian the Great is not the only one to have gone chasing for lost glory even at the risk of losing their current valuables. About 1,500 years after his death investors today still exhibit what I’m calling the Justinian Complex. (I’ve just invented this so if it ever gets widely adopted do remember to give me credit.) The Justinian Complex is the tendency to hold on to losing ventures or to seek to recover lost ventures at the risk of ruining a successful one.

Examples of this include holding on to a stock in an equity portfolio which risks tanking the return of the whole portfolio because of steep losses. Or to hold on to a losing trade for so long that you risk a margin call. Outside finance, it could be investing your energy into projects which risk affecting your relationships, your health or your output at work even though the projects lead nowhere.

Although I am an advocate of taking calculated risks, I am wary of investments which threaten to lose more than the capital allocated to them and begin to eat into my portfolio that is built for long term security. None of us can predict the future and so it is perfectly rational to make decisions based on past and current information. And if after careful analysis a venture shows signs of continuing to be a lost cause, there’s no reason to continue. After all, life is short, and there is much more to be explored in the time we have here.