Category Archives: Psychology

Investors should continually challenge their perception of a business

By Nick Kirrage. Think of the single company about which you are most negative and note down all the reasons you hate it. Now imagine Warren Buffett bought a 5% stake in it this morning. How do you feel about … Read More

Posted in Behavioural finance, Markets, Psychology, Value Investing | Leave a comment

PSB Latticework: On Demographics and Retirement

An updated, reorganized Latticework is now available, which in technical speak provides access to the deep structure of the blog and which, for us laymen, is a way of recycling old content. One of the more immediately relevant sections is On Demographics … Read More

Posted in Behavioural finance, Demographics, Psychology | Leave a comment

Good robots, bad robots, and us

Loving them and fearing them Robots are getting better and better, and easier and easier to manage. Recently Tom Friedman described robots that are easy to use and flexible, that help workers instead of replacing them. “Our robot is low-cost, … Read More

Posted in Manufacturing, Psychology, Technology | Leave a comment

Birds, Bees and Decoy Effects

Fleeced If there’s one message I hope to get across here it’s that we’re our own worst enemy when it comes to making decisions if we’re anywhere in the vicinity of money.  If there’s a second one it’s that if … Read More

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PSB Latticework: On Investing Psychology and Emotion

An updated, reorganized Latticework is now available, which in technical speak provides access to the deep structure of the blog and which, for us laymen, is a way of recycling old content. The single largest theme is On Investing Psychology and … Read More

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Risky Shifts

Female Underwear (Not) No doubt some will be disappointed to learn that a risky shift is not a slightly daring article of female underwear, but an outcome of the counterintuitive process of group polarization. This says that if you take … Read More

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Minding the Chastity Belts: Fiduciary Duties and 900 Pound Lemmings

“Today investors herd around short-term investment strategies adopted by other prudent experts who manage similar funds. This has unleashed a flock of 900-pound lemmings into the economy.” Back to the Future of Pension Fund Trust Fiduciary Duties, Keith Johnson Crusading Fiduciaries If … Read More

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Unrealistic Optimism and the Impoverished Investor

Hope is the thing with feathers that perches in my soul – Emily Dickinson Eternal Optimists Humanity is unrelentingly optimistic in the face of contradictory evidence.  Our ability to demonstrate unrealistic optimism bridges cultures, races, genders and societies.  We simply … Read More

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Things Investors Should Hate 5/5: Themselves

We can blame many things for the state of our retirement savings plans – economists, bankers, politicians, the Chinese, globalization, sunspots, socialists, capitalists, journalists, investment analysts, financial advisors or even just bad luck.  But in the end the only person … Read More

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Things Investors Should Hate 4/5: Observation

No human being can resist trying to draw general conclusions from personal observation.  It’s not purely a matter of wilful ignorance, but is an in-built evolutionary trait necessary for our ancestors’ survival. After all, on the primeval savannah if you … Read More

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