How to Get Lucky: Focus on the Fat Tails

Investing more in fat tails means being wrong a lot more, and perhaps this is why the most successful people often say they made a lot of mistakes. They made a lot of fat tail investments, most didn’t pay off, but the ones that did made all the difference.

Relationships : If you were trying to maximize your personal happiness, you would spend 50% of your time with 1% of your “network.“ Maybe four or five total people. A really great friend will bring you ten times the pleasure of a good friend and 100 times that of a loose acquaintance.

Any given book is only marginally better than any other book if you think about books falling on a bell curve, but on the 80/20 curve, a great book could be ten or a hundred times as valuable as an OK or good book.

You can learn more about a field by reading the three foundational books then you can reading the most recent thirty. I’ve met people wh... See more

The ads keep you alive while you wait for one of the fat tail bets to pay off.

The difference between how everyone walking around with a bell curve model see the world, and how the few people walking around with an 80/20 curve model see the world, is margin. The fat tail of the 80/20 curve is systematically under-invested in.

By shifting your attention from that fat part of the bell curve to the the fat tail of the 80/20 distr... See more

Almost everyone systematically under-allocates resources to the fat tails . We tend to spend most of our time and energy thinking about the middle, because we see the world through a bell curve lens, and most of the area in a bell curve is in the middle. But in reality, we live in an 80/20 world, where the top 1% of fat tails account for 50% of the... See more