tips on how to fine-tune your existing investments
…is themselves. That’s right, the single largest risk to investors is themselves. By that, I, of course, mean the influence of human emotion and psychology in decision making. It seems quite clear to me that humans are uniquely wired incorrectly for long-term…
At the beginning of each year, there’re many pundits, experts, self-proclaimed gurus, and other suspicious characters who’d like to sell you stuff predicting the directions of the Stock Markets. As I personally have ample years of experience in the Stock Markets…
Could we both agree on the following notion? That, in the investment field, there is no one instrument that can perform all the time, and that there is no one who can say with certainty—in advance—which instrument would perform best. The future is uncertain and markets are random. As such, what Harry Markowitz…
I can literally envision all you regular readers rolling your eyes at yet another “brainy” post and thinking: “Tacomob, haven’t you written more than enough about the brain already? Isn’t there some other topic on your mind?” Of course there is, and that’s why I am…
Recently there has been a lively discussion among the Singapore Financial Blogger Scene about ‘Net Worth’ and how it should/could/may be computed (here, here, and here). This showed me how imperfect and susceptible to bias we all are. We are…
A few weeks ago, I wrote herewithin about a natural phenomenon: When things go well, we tend to ascribe our success to our abilities—our disposition. But when they go wrong, we tend to blame external factors—our situation. Finished. Done. Quick conclusion. Move on. But wait…
In psychology, there is the term “Information Bias” which is the tendency to seek information when it doesn’t affect our actions. Nevertheless, more information isn’t always better. The instinctual shortcut that we take when we have “too much information” is to…
“Imagine you pick 1 million random people from around the world every day,” said Toby McDade, chief investment officer of Momentum Fee Capital Management. “Some days, 51% would be in a good mood, 49% in a bad mood. The next…
I blogged about our deficits in predicting the future the other day and mentioned not only our tendency to compare the present to the past, but also how we tend to get history wrong—by neglecting the impact that accidents and chance had on them. Isn’t our place in history today…
This bias might be at the root of all the other biases that very active traders “enjoy”. Yet, being right has very little to do with making money! The evidence is overwhelming that the more we trade, the worse we would do. That’s because most…