Sublime

Many finance and investment decisions are rooted in watching what other people do and either copying them or betting against them. But when you don’t know why someone behaves like they do you won’t know how long they’ll continue acting that way, what will make them change their mind, or whether they’ll ever learn their lesson.

There is reasonably strong evidence for what Thaler calls No Free Lunch—it is difficult (although not literally impossible) for any investor to beat the market over the long-term. Theoretically appealing opportunities may be challenging to exploit in practice because of transaction costs, risks, and other constraints on trading. Statistical

The threat to a buy-and-hold program is the investor himself. Following his stocks and listening to stories and advice about them can lead to trading actively, producing on average the inferior results about which I’ve warned. Buying an index avoids this trap.

Day trading and picking individual stocks is not rational for most investors—the odds are heavily against your success. But they’re both reasonable in small amounts if they scratch an itch hard enough to leave the rest of your more diversified investments alone.

pioneer of modern portfolio theory

The flood of effective altruists into the firm was worrisome. These people arrived with their own value system. They had their own deep loyalties to something other than Jane Street. They didn’t have the usual Wall Street person’s relationship to money; they didn’t care about their bonuses in the ways Wall Street people were supposed to care. Sam

One truth of archaeology in particular bears directly on my thinking. Archaeologists have their specialties, and one of the curiosities of the field is that those who specialize in one aspect of antiquity tend to be blind to anything else. Archaeologists who look for pottery sherds will not see coins, and, conversely, those who look for coins will

Behavioral finance is the study of the way people consistently act against their own best financial interests, as well as how to exploit these psychological weaknesses when peddling questionable securities and products. These are proven behaviors with industry-accepted names like “money illusion bias,” “loss aversion theory,” “irrationality bias,”