Nuggets of Investing Wisdom

Nuggets of Investing Wisdom

A website for serious investors in common stocks

Skip to content
  • Home
  • About
  • Terms and Conditions
  • Login
  • Motherlode

Gambling, trading, risk intolerance and investing

  • by Rodney Smith
  • Posted on December 20, 2022December 20, 2022
  • Part 4: Principles of Operation

An investment is a favourable bet. Gambling is an unfavourable bet.

Read More

The danger of too low inflation

  • by Rodney Smith
  • Posted on December 11, 2022December 11, 2022
  • Part 1: The Field of Play

Prior to Covid the neutral interest rate had continued its long decline

Read More

A set of rules to develop a behavioral edge – Part 7

  • by Rodney Smith
  • Posted on December 4, 2022December 4, 2022
  • Part 2: Human Foibles and Investment Decision Making

Subjective confidence in a judgment is not a reasoned evaluation of the probability that this judgment is correct

Read More

A set of rules to develop a behavioral edge – Part 6

  • by Rodney Smith
  • Posted on November 27, 2022November 28, 2022
  • Part 2: Human Foibles and Investment Decision Making

The strong bias toward believing that small samples closely resemble the population from which they are drawn is also part of a larger story

Read More

A set of rules to develop a behavioral edge – Part 5

  • by Rodney Smith
  • Posted on November 20, 2022November 20, 2022
  • Part 2: Human Foibles and Investment Decision Making

Our mind searches for confirming evidence that we are right and shies away from contrary evidence.

Read More

A set of rules to develop a behavioral edge – Part 4

  • by Rodney Smith
  • Posted on November 13, 2022November 13, 2022
  • Part 2: Human Foibles and Investment Decision Making

Herding. All stock market prices are both the cause and result of herding behavior amongst investors.

Read More

A set of rules to develop a behavioral edge – Part 3

  • by Rodney Smith
  • Posted on November 6, 2022November 9, 2022
  • Part 2: Human Foibles and Investment Decision Making

Our gut needs training. Many of our instinctive feelings are the exact opposite of what we should be doing.

Read More

A set of rules to develop a behavioral edge – Part 2

  • by Rodney Smith
  • Posted on October 30, 2022November 2, 2022
  • Part 2: Human Foibles and Investment Decision Making

It is very important not to fall into the attractive trap of extrapolating the most recent past into the future.

Read More

A set of rules to develop a behavioral edge – Part 1

  • by Rodney Smith
  • Posted on October 23, 2022October 23, 2022
  • Part 2: Human Foibles and Investment Decision Making

Today everyone is fretting about inflation and the potential for a recession. Trying to decide on the outlook for these macro-economic things can be a distraction.

Read More

Have a good read while we are away on holiday

  • by Rodney Smith
  • Posted on October 17, 2022October 17, 2022
  • Uncategorized

The edge for investors is what I call the behavioral edge. You don’t need more data than everyone else. You don’t need to be smarter. You just need to master your own behavior.

Read More

Posts navigation

Older posts
Newer posts

How This Site Works

The site has two parts – Nuggets and the Investing Motherlode. Nuggets is a blog. The Motherlode is a rich resource and is only available to Subscribers (free). To subscribe, click on the Login tab or on any link within the Motherlode and fill in the form. You can also subscribe, for free, to a monthly newsletter, Nuggets of Investing Wisdom, right to your inbox.

 

Categories

Tags

accounting goodwill active investing Affect Heuristic algorithms alpha analysts anchoring animal spirits asset allocation attractive prices availability heuristic averaging down averaging up balance bargain beating the market behavioral biases behavioral edge benchmarking beta bitcoin board bonds book value book value of equity bottom up broad framing bubbles business franchise butterfly effect buying CAPE cash cause causes character charts cognitive errors committees commodities common stocks competition complex adaptive systems complexity compounding concentrated portfolio confirmation bias conservative contrarian thinking conventional conviction correlation crisis crowd cyclical debt equity ratio debt service deflation deliberate practice discipline Discounted Cash Flow discount rate disinflation diversification dividends dual-class shares earnings estimates economic goodwill economic performance Economy efficient markets EMH equity risk premium estate plan ETF Excess CAPE Yield expectation expected return experience FAAMGN fair value fear Federal Reserve Fed Model financial planning financial statements financial strength finding companies Fisher flexibility forecasts framing free cash flow funds from operations GAAP gains gambling gap-to-edge rules gold goodwill Graham greed groupthink growth growth investing growth stocks Halo effect herd Heuristic holiday edition home bias income splitting independent thinking indexing inductive reasoning inefficient markets inelasticity inflation intangible intangible assets intelligence interest rates intrinsic value intuition investment process investment psychology investment style IRR Kelly Criterion KISS learning linear regression long term long term debt long view losers losses Luck madness of crowds management margin of safety margins market timing math maximum pessimism mental accounting millennials mistakes moats money illusion monitoring narrow framing net earnings news non-stationarity oligopoly opportunities optimism Oreo cookies outlook overconfidence overreaction owner earnings parabolic paradox of skill passive investing path of returns patterns peer pressure performance permacrisis personal qualities polycrisis portfolio management portfolio strategy portfolio structure predictions price price accepting price discovery price earnings price earnings ratio price to book value ratio price to free cash flow ratio priming principles of operation probabilistic probability quantitative analysis random data random walk reading recent past recession reports resilience retained earnings retirement planning return on equity return on invested capital returns reward risk risk/reward risk aversion risk intolerance risk management risk policies risk seeking scaling sector rotation selling seven footers Sharpe Ratio short term simple Skill social influence social proofing standard deviation statistics stock market stock picking superb businesses superb companies superior results target prices themes top down total return trading trend Uncertainty value value investing value stocks vivid memories volatility watchlists weighted average cost of capital windfalls winners wisdom of crowds

Archives

Privacy & Cookies: This site uses cookies. By using the website you consent to their use, and to the Terms and Conditions described in this link, and also available from the menu bar at the top of the page. Terms & Conditions
 

Loading Comments...
 

You must be logged in to post a comment.