We have a peculiar problem in the world right now.
Ever since Daniel Kahneman, Amos Tversky, and Richard Thaler proved that we humans are flawed and full of biases, every other idiot has taken to pointing them out. Off late, I cannot go two scrolls on twitter without some fucking moron using terms like “recency bias” or “confirmation bias” or some other goddammed bias.
The book Thinking, Fast and Slow is probably one of the most influential books of this generation. But it has turned every other moron into a behavioural expert. Not just Twitter, every goddamn presentation about investing, products etc. are littered with references to biases. The irony is that the people who talk and write about this stuff are idiots at best and morons at worst.
Don’t get me wrong. I have no problem with behavioural investing principles. I have a problem with morons with half baked understanding of these principles using these terms haphazardly to seem smart.
All this finger-pointing about this bias or the other bias does no one any good. Especially by idiots who have no clue about the meaning of these principles in the first place. We humans are flawed, and we commit dumb mistakes, monumentally dumb mistakes even – that’s what makes us human. But we humans also have the ability to learn from mistakes. Some of the biggest investing lessons aren’t learnt from books, seminars, or on Twitter. They are learnt from experience.
I hadn’t realized that there were seminars on this stuff. But hey, you have to admit, it’s a beautiful scam. Also, this tweet perfectly sums up this incoherent rant.
Unlike options trading or investing seminars, where scamsters might actually have to take a trade and showcase their supposed “skill”, all it takes to conduct behavioural seminars is a presentation with fancy words. I wish I had thought of this racket.
A survey by Charles Schwab found these to be the biggest biases afflicting investors.
I’d be more interested in a survey that measures how many investors changed their behaviour once they became aware of their biases. If I were to wager, I’d say few to none.
How do you get over your biases? I’ve no clue! But here’s what works for me. I know that If I don’t save enough, I’ll end up homeless on the street in my retirement. If I do dumb shit with my investments, I’ll have to pay child support to my wife, who may end up homeless on the street with my kids. Yes, I’m shit scared when it comes to investing. When I say scared, doesn’t mean all my money in an FD or in a debt fund. I mean, I’m scared of my actions ruining my nest egg.
If you don’t trust yourself, then hire a good advisor who’ll keep you in line.
So, fuck you, I know I am biased, and I don’t need you to point it out, you dimwitted nincompoop.