In what other field does someone with no education, no relevant experience, no resources, and no connections vastly outperform someone with the best education, the most relevant experiences, the best resources and the best connections? There will never be a story of a Grace Groner performing heart surgery better than a Harvard-trained cardiologist. Or building a faster chip than Apple’s engineers. Unthinkable.
But these stories happen in investing.
That’s because investing is not the study of finance. It’s the study of how people behave with money. And behaviour is hard to teach, even to really smart people. You can’t sum up behaviour with formulas to memorise or spreadsheet models to follow. Behaviour is inborn, varies person to person, is hard to measure, changes over time, and people are prone to deny its existence, especially when describing themselves.
Little observation taught me managing money isn’t necessarily about what you know; it’s how you behave. But that’s not how finance is typically taught or discussed. The finance industry talks too much about what to do, and not enough about what happens in your head when you try to do it.
It will be a good idea to list down your thoughts & emotions when you try to execute any trade.ability to just notice your emotions is highly underrated in investing. We all need to learn more & more about our own emotions rather than about markets & interest rates.
I see the potential for a new course in finance.