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Module Units
- 1. Introduction
- 2. Investment In Yourself
- 3. Become A Learning Machine
- 4. Obtain Worldly Wisdom
- 5. Harnessing The Power Of Passion
- 6. The Importance Of Choosing The Right Role Models
- 7. Humility Is The Gateway To Attaining Wisdom
- 8. The Virtues Of Philanthropy And Good Karma
- 9. Simplicity Is The Ultimate Sophistication
- 10. Achieving Financial Independence
- 11. Living Life According To The Inner Scorecard
- 12. Delayed Gratification
- 13. Building Earning Power
- 14. Investing Between The Lines
- 15. Decision-Making
- 16. Checklist For The Standard Causes Of Human Misjudgment
- 17. Journaling
- 18. Power Of Incentives
- 19. Avoid Physics Envy
- 20. Intelligent Investing
- 21. The Three Most Important Words In Investing
- 22. Investing Is All About Capital Cycle
- 23. Analyzing Special Situations
- 24. The Holy Grail Of Long-Term Investing
- 25. Connecting The Dots
- 26. Market Is Not Efficient All Time
- 27. The Dynamic Art Of Portfolio Management
- 28. To Finish First, You Must First Finish
- 29. Read More History And Fewer Forecasts
- 30. Updating Your Beliefs In Light of New Evidence
- 31. Opportunity Costs
- 32. Pattern Recognition
- 33. Role of Luck, Chance, Serendipity, And Randomness
- 34. Value Investor
- 35. Conclusion
Updating Your Beliefs In Light of New Evidence
The author advises to strike a balance between conviction and flexibility when investing.
Change your opinions when the facts change. Whatever your strong opinions are, be open to changing your mind when new facts and situations emerge.
Expose yourself to opposing viewpoints and opinions to avoid confirmation bias. Discuss a stock with others to learn about their perspectives. Request that a friend play devil's advocate and challenge your assumptions.
Good investing requires a unique balance of conviction in following your ideas and flexibility in recognising when you have made a mistake. You must believe in something while also accepting that you will be wrong a significant number of times over the course of your investing career. This is true for all investors, regardless of their position. The ability to strike a balance between confidence and humility is best learned through trial and error.
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