The power and gravitation pull of doing nothing in asset management

There is value in doing nothing in asset management. One, doing nothing reduces transaction costs. Two, doing nothing allows for the power of compounding. Three, doing nothing reduces the emotional biases associated with trying to take action. Four, doing nothing helps to clarify the distinction between effort and work. Showing that you are doing something is not the same as doing work. 

By having a long-term view, there should be less trading. Long-term investing is a do-nothing management approach because the long-term decisions should not be swayed by short-term changes in markets. There is more value in doing less. 

These are all good reasons, but there is also a pull to doing nothing that has a negative effect. Nevertheless, no action at the wrong time will be costly. Fear of making mistakes and emotional regret may stop an investor from taking needed action. Aversion to regret will reduce action. You cannot regret the action not taken. You could, but generally, regret is about what was done, not what was missed. Lack of knowledge or ignorance.

So, there needs to be a checklist for action. Do I have a valid reason for action? Do I have the right time perspective? Have I accounted for the cost of trading? Will I regret this decision if the market direction changes?  Be careful with action. From a model perspective, what is the action beyond a prediction of noise.