Liberty Posted October 21, 2011 Share Posted October 21, 2011 [amazonsearch]Thinking, Fast and Slow[/amazonsearch] http://www.nytimes.com/2011/10/21/opinion/brooks-who-you-are.html?_r=1 Coming out soon. His research into cognitive biases and heuristics is very helpful to any value investor who tries to have an edge by being more rational than the market. I also recommend: [amazonsearch]Judgment Under Uncertainty: Heuristics and Biases[/amazonsearch] [amazonsearch]Heuristics Biases: The Psychology of Intuitive Judgment[/amazonsearch] Link to comment Share on other sites More sharing options...
eclecticvalue Posted October 21, 2011 Share Posted October 21, 2011 I read the article in the NYT. My takeaway from the article is he thinks any of the great investors that have done very well. All of their success is attributed to luck. The few paragraphs that talks about overconfidence was great. Link to comment Share on other sites More sharing options...
Liberty Posted October 22, 2011 Author Share Posted October 22, 2011 I read the article in the NYT. My takeaway from the article is he thinks any of the great investors that have done very well. All of their success is attributed to luck. The few paragraphs that talks about overconfidence was great. I'm not sure I understand. Where does the NYT article talks about investing and luck? In any case, the NYT piece is pretty superficial and that writer isn't known for his accuracy about scientific matters. I recommend reading the source material. Link to comment Share on other sites More sharing options...
eclecticvalue Posted October 22, 2011 Share Posted October 22, 2011 This is the link I was talking about. http://www.nytimes.com/2011/10/23/magazine/dont-blink-the-hazards-of-confidence.html?pagewanted=all Link to comment Share on other sites More sharing options...
Liberty Posted October 22, 2011 Author Share Posted October 22, 2011 Thanks for the link. He seems to basically agree with Buffett and Munger that most of the finance industry adds very little value. Link to comment Share on other sites More sharing options...
eclecticvalue Posted October 22, 2011 Share Posted October 22, 2011 I agree the financial services industry doesn't provide much value. I gleaned from the article that most stock pickers don't do well and the very successful ones performance is all luck. Link to comment Share on other sites More sharing options...
Liberty Posted October 22, 2011 Author Share Posted October 22, 2011 I agree the financial services industry doesn't provide much value. I gleaned from the article that most stock pickers don't do well and the very successful ones performance is all luck. He seems to have studied random wall street traders, so I'm not surprised that he came up with that conclusion. I don't think it's meant to applied to all investors, including value ones. But in any case, what's most interesting about the work of Daniel K. and Amos T. is not their work that is directly about investing. It's more about this kind of stuff: http://en.wikipedia.org/wiki/List_of_cognitive_biases Link to comment Share on other sites More sharing options...
twacowfca Posted October 22, 2011 Share Posted October 22, 2011 Kahneman and Tversky, may he rest in peace, tell it like is for the 99 % of investment advisors and fund managers that don't live in Graham and Doddsville or are just visiting. :) Link to comment Share on other sites More sharing options...
eclecticvalue Posted October 22, 2011 Share Posted October 22, 2011 I wasn't sure if he meant value investors also. Thank you for your thoughts Liberty. I wonder what were his thoughts on value investors. Also the list of cognitive bias is very long I wonder if I could master all of them. I have made mistakes from those bias' Link to comment Share on other sites More sharing options...
Guest Hester Posted October 23, 2011 Share Posted October 23, 2011 Sam Hrris is doing an interview with Kahneman and will be asking some questions submited by readers. For anyone interested: http://www.samharris.org/site/contact_author/ Link to comment Share on other sites More sharing options...
gaf63 Posted October 27, 2011 Share Posted October 27, 2011 Bloomberg has 3 excerpts from their book with a 4th to follow, here is the link to the 3 rd part(with links to 1 & 2) http://www.bloomberg.com/news/2011-10-26/bias-blindness-and-how-we-truly-think-part-3-daniel-kahneman.html Link to comment Share on other sites More sharing options...
dcollon Posted October 27, 2011 Share Posted October 27, 2011 I'm enjoying the book so far, but have a long ways to go. Link to comment Share on other sites More sharing options...
biaggio Posted October 29, 2011 Share Posted October 29, 2011 http://myinvestingnotebook.blogspot.com/2011/10/video-kahneman-market-cancels-random.html interview with author from Farnham's website/blog Link to comment Share on other sites More sharing options...
netnet Posted November 11, 2011 Share Posted November 11, 2011 [amazonsearch]Thinking Fast and Slow[/amazonsearch] I'm am halfway through Daniel Kahneman's new book Thinking Fast and Slow. It is nothing short of brilliant. You must read this book! (Kahneman, a psychologist, won a Nobel in Economics. Partially an intellectual memoir, it is brilliant, illuminating (and also has some nice elegiac passages about his late collaborator, Amos Tversky.) It reads like a conversation with your favorite uncle who happens to be brilliant and who won a Nobel prize by inventing an entirely new field. Here is Michael Lewis's Vanity Fair article on the book: http://www.vanityfair.com/business/features/2011/12/michael-lewis-201112 Link to comment Share on other sites More sharing options...
Liberty Posted November 11, 2011 Author Share Posted November 11, 2011 There's already a thread about this book: http://www.cornerofberkshireandfairfax.ca/forum/index.php?topic=5488.0 Link to comment Share on other sites More sharing options...
alpha231616967560 Posted November 11, 2011 Share Posted November 11, 2011 This is the link I was talking about. http://www.nytimes.com/2011/10/23/magazine/dont-blink-the-hazards-of-confidence.html?pagewanted=all Fascinating article. I have often observed that my favorite people after which to model my own behavior are those with loads of humility coupled with above average results. People with the sense to be humble are often the ones who learn / adapt most readily even when they are highly accomplished. Link to comment Share on other sites More sharing options...
netnet Posted November 11, 2011 Share Posted November 11, 2011 I know. After i wrote it, I tried to kill the message, but the system would not let me. Link to comment Share on other sites More sharing options...
DCG Posted November 11, 2011 Share Posted November 11, 2011 This book looks interesting. I have too many damn books on my reading list and not enough time, but I'll add this one to the list. Link to comment Share on other sites More sharing options...
biaggio Posted November 11, 2011 Share Posted November 11, 2011 This book looks interesting. I have too many damn books on my reading list and not enough time, but I'll add this one to the list. I know what u mean Link to comment Share on other sites More sharing options...
AZ_Value Posted November 11, 2011 Share Posted November 11, 2011 This book looks interesting. I have too many damn books on my reading list and not enough time, but I'll add this one to the list. I've had to learn to live with this problem for a while now. Someone needs to disable my Amazon account until I work my way through my current reading list. It's starting to get ridiculous. But I somehow always get excited and order a new one. Link to comment Share on other sites More sharing options...
oddballstocks Posted November 11, 2011 Share Posted November 11, 2011 This is the link I was talking about. http://www.nytimes.com/2011/10/23/magazine/dont-blink-the-hazards-of-confidence.html?pagewanted=all Fascinating article. I have often observed that my favorite people after which to model my own behavior are those with loads of humility coupled with above average results. People with the sense to be humble are often the ones who learn / adapt most readily even when they are highly accomplished. Humility is huge, probably the most underrated quality but one that plays the biggest factor in outcomes. Often ego or pride will blind people to data or outcomes. I wish humility would get more airtime, of course not many people actually strive for humility... Link to comment Share on other sites More sharing options...
ubuy2wron Posted April 26, 2012 Share Posted April 26, 2012 I am about half way through this gem of a book by Daniel Kahneman a Nobel Prize winner for economics. I rate it a must read for anyone who wants to understand why most individuals find the discipline of investing so gosh darn frustrating. We are mostly hard wired to make poor choices. http://www.theglobeandmail.com/news/arts/books/thinking-fast-and-slow-by-daniel-kahneman/article2249529/ Link to comment Share on other sites More sharing options...
rogermunibond Posted April 27, 2012 Share Posted April 27, 2012 My take from his book is that we were mostly wired to make fast choices in an environment and complexity level that changed dramatically from our evolutionary past to now. Link to comment Share on other sites More sharing options...
ubuy2wron Posted April 27, 2012 Share Posted April 27, 2012 Roger As I said I am only half way through, but the fact that individuals let their type one thinking make so many decisions even the important ones explains , at least partially, why the value discipline can produce superior returns. Link to comment Share on other sites More sharing options...
Liberty Posted April 27, 2012 Author Share Posted April 27, 2012 If you liked this you can go straight to the source: http://www.amazon.com/Judgment-under-Uncertainty-Heuristics-Biases/dp/0521284147/ http://www.amazon.com/Heuristics-Biases-Psychology-Intuitive-Judgment/dp/0521796792/ http://www.amazon.com/Choices-Values-Frames-Daniel-Kahneman/dp/0521627494/ Link to comment Share on other sites More sharing options...
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