June 2018
Beginner
192 pages
4h 4m
English
It ain't what you don't know that gets you into trouble. It's what you know for sure that just ain't so.
—Mark Twain
One day in early 2017, $105 billion worth of S&P 500 stocks were traded. Every person that sold and every algorithm that bought thought they were on the right side of the trade. It's true, investors are a confident bunch.
When it comes to the future, which is by definition unpredictable, we tend to believe we know more than we actually can. One of the ways that this manifests itself in investing is in something called the endowment effect. After consumers or investors make a purchase, we value this new possession more than we did before it was ours.
Imagine you're wagering on ...