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The key takeaway that I got from this article: overcoming your emotional biases as an investor is a full time job. If you're willing to spend 20+ hours per week

by whack 10y ago

The key takeaway that I got from this article: overcoming your emotional biases as an investor is a full time job. If you're willing to spend 20+ hours per week on this, more power to you. Otherwise, you'd be better off buying & holding index funds for decades.

lintiness 10y ago
your response intrigued me, because on the one hand you said we needed to spend endless hours overcoming our mental weaknesses, then described how you'd overcome it by devoting next to no time to it at all. most professionals in the money management business (i happen to be one) work awfully hard and add no value at all.
- blawson 10y ago
  I think the point is that becoming sufficiently dispassionate isn't something you can do in a few hours a week. If you have the time to dedicate to doing so, great, but realistically so many people are better off using that time to get better at what they're already good at, and just buy the broad market.
adventured 10y ago
The people that are best at at, are genetically wired for it. I'm one of those people for example. It takes almost no effort for me to keep emotion out of decisions on investments. I am extremely difficult to influence and have very low susceptibility to the opinions of others. That has been the case since I was young, I didn't have to learn anything to do it and I don't have to work at keeping it that way. I watch in bewilderment as other investors routinely fret, panic, get angry, get euphoric, in frequent wild swings with their investments. They let the price and its movement dictate their emotion and confidence in their decisions; they let the behavior of other investors dictate how they calculate the value of the underlying business. One minute a stock is $30 and two weeks later it's $22; at that point most people emotionally think it's a disaster and start to panic, regardless of consideration for the underlying fundamentals of the business. I got so annoyed by the extreme emotionalism that rules most investors that I decided to write a book on the subject, which I'm working on now (optimistically hoping I can find something original to add to the numerous pre-existing writings on the subject).
- Kluny 10y ago
  /r/iamverysmart
- whack 10y ago
  That actually sounds like an interesting premise for a book. If you ever finish the book, or are looking for someone to read it and offer you feedback, my email is listed in my profile.

by whack 10y ago

lintiness 10y ago

your response intrigued me, because on the one hand you said we needed to spend endless hours overcoming our mental weaknesses, then described how you'd overcome it by devoting next to no time to it at all. most professionals in the money management business (i happen to be one) work awfully hard and add no value at all.

blawson 10y ago
I think the point is that becoming sufficiently dispassionate isn't something you can do in a few hours a week. If you have the time to dedicate to doing so, great, but realistically so many people are better off using that time to get better at what they're already good at, and just buy the broad market.

adventured 10y ago

The people that are best at at, are genetically wired for it. I'm one of those people for example. It takes almost no effort for me to keep emotion out of decisions on investments. I am extremely difficult to influence and have very low susceptibility to the opinions of others. That has been the case since I was young, I didn't have to learn anything to do it and I don't have to work at keeping it that way. I watch in bewilderment as other investors routinely fret, panic, get angry, get euphoric, in frequent wild swings with their investments. They let the price and its movement dictate their emotion and confidence in their decisions; they let the behavior of other investors dictate how they calculate the value of the underlying business. One minute a stock is $30 and two weeks later it's $22; at that point most people emotionally think it's a disaster and start to panic, regardless of consideration for the underlying fundamentals of the business. I got so annoyed by the extreme emotionalism that rules most investors that I decided to write a book on the subject, which I'm working on now (optimistically hoping I can find something original to add to the numerous pre-existing writings on the subject).

Kluny 10y ago
/r/iamverysmart
whack 10y ago
That actually sounds like an interesting premise for a book. If you ever finish the book, or are looking for someone to read it and offer you feedback, my email is listed in my profile.