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Re: Financial Psychology - Mind Over Money

One can't diagnose one's own cognitive biases at the time when these biases are active and potentially damaging. One can't say "I am in the middle of anchoring thinking, please help me get off!" Once you name it, you don't need outside help. Well, I'm not sure that's true. I think one can...
by Fallible
Wed Sep 17, 2014 10:49 pm
 
Forum: Investing - Theory, News & General
Topic: Financial Psychology - Mind Over Money
Replies: 72
Views: 2929

Re: Financial Psychology - Mind Over Money

Postingname wrote: But I don't remember seeing anything that I could specifically -- off the top of the bat -- apply to investing. A lot of it applies to investing. Have you seen Behavioral Pitfalls in the Wiki? The people over on the dark side of investing also have a blog category about it: http:...
by Fallible
Wed Sep 17, 2014 8:26 pm
 
Forum: Investing - Theory, News & General
Topic: Financial Psychology - Mind Over Money
Replies: 72
Views: 2929

Re: What books next?

Hi all - Thanks in advance for your input! I am familiar with the wiki page " Books: Recommendations and Reviews " but wanted to get some input from the forum on what books you recommend I read next . There are too many to choose from and several are out of date now that it makes it hard ...
by Fallible
Wed Sep 17, 2014 4:19 pm
 
Forum: Personal Finance (Not Investing)
Topic: What books next?
Replies: 5
Views: 304

Re: Financial Psychology - Mind Over Money

The beauty of buy-and-hold investing is that it avoids behavioral mistakes by avoiding behavior instead of avoiding mistakes. The less you look at your investments and the fewer choices you have to make, the fewer opportunities there are for getting things wrong. So pick a simple plan and stay the ...
by Fallible
Wed Sep 17, 2014 1:52 pm
 
Forum: Investing - Theory, News & General
Topic: Financial Psychology - Mind Over Money
Replies: 72
Views: 2929

Re: Financial Psychology - Mind Over Money

... No, there have been some real interesting experiments that look at the ability of those fully aware of specific biases to overcome them - I'll try to tack them down for you but the long and short of it was they weren't measurably more successful than those unaware of the biases and in at least ...
by Fallible
Wed Sep 17, 2014 10:13 am
 
Forum: Investing - Theory, News & General
Topic: Financial Psychology - Mind Over Money
Replies: 72
Views: 2929

Re: Jason's Zweig's new dictionary ---enjoy

http://www.jasonzweig.com/dictionary/ I'm sure Boglehead's will enjoy reading Jason's dictionary Larry Fantastic! Thanks, Larry. Bierce's dictionary was much fun and I'm glad to see a financial version, like this one, which will no doubt remind many of Bank of America's buying Merrill Lynch: "...
by Fallible
Wed Sep 17, 2014 9:15 am
 
Forum: Investing - Theory, News & General
Topic: Jason's Zweig's new dictionary ---enjoy
Replies: 16
Views: 1055

Re: Key to happiness in retirement

“I am a happy camper so I guess I’m doing something right. Happiness is like a butterfly; the more you chase it, the more it will elude you, but if you turn your attention to other things, it will come and sit softly on your shoulder.” ― Henry David Thoreau Being a great fan of serendipity, I've al...
by Fallible
Tue Sep 16, 2014 8:21 pm
 
Forum: Personal Finance (Not Investing)
Topic: Key to happiness in retirement
Replies: 36
Views: 3603

Re: Key to happiness in retirement

Have a Passion. Much overlooked and very necessary. Don't delay "retirement" too long. Delayed gratification can lead to No Gratification at the drop of a hat. My $.02 If you have a true passion, it couldn't be overlooked. It will be at the forefront of just about everything you do and re...
by Fallible
Tue Sep 16, 2014 8:07 pm
 
Forum: Personal Finance (Not Investing)
Topic: Key to happiness in retirement
Replies: 36
Views: 3603

Re: Financial Psychology - Mind Over Money

As for Kahneman and Ariely, both are quite realistic about the difficulty in dealing with our biases. I don't think they ever thought awareness would protect them from their biases, nor do I think they ever meant that awareness could not help people deal with them. I once glanced through the Kahnem...
by Fallible
Tue Sep 16, 2014 7:53 pm
 
Forum: Investing - Theory, News & General
Topic: Financial Psychology - Mind Over Money
Replies: 72
Views: 2929

Re: Financial Psychology - Mind Over Money

Kahneman, Ariely, and other prominent BE researchers freely admit that the knowledge of cognitive biases has not protected them from making every mistake in the book. I always thought that their editors forced them to put that in their books. No, there have been some real interesting experiments th...
by Fallible
Tue Sep 16, 2014 6:49 pm
 
Forum: Investing - Theory, News & General
Topic: Financial Psychology - Mind Over Money
Replies: 72
Views: 2929

Re: Financial Psychology - Mind Over Money

... Loss aversion (whose existence has been questioned by some recent studies) is not fear of a market crash but the asymmetrical value between losses and gains of equal value - passive indexing would do nothing to help with loss aversion per se. Handing over management of your money to someone els...
by Fallible
Tue Sep 16, 2014 1:56 pm
 
Forum: Investing - Theory, News & General
Topic: Financial Psychology - Mind Over Money
Replies: 72
Views: 2929

Re: Key to happiness in retirement

“I am a happy camper so I guess I’m doing something right. Happiness is like a butterfly; the more you chase it, the more it will elude you, but if you turn your attention to other things, it will come and sit softly on your shoulder.” ― Henry David Thoreau Being a great fan of serendipity, I've al...
by Fallible
Tue Sep 16, 2014 1:09 pm
 
Forum: Personal Finance (Not Investing)
Topic: Key to happiness in retirement
Replies: 36
Views: 3603

Re: What evidence would prove the Boglehead mentality wrong?

The "Boglehead mentality" is, ultimately, common sense. What common sense is based on can change, but never the common sense about it. :happy
by Fallible
Tue Sep 16, 2014 12:44 pm
 
Forum: Investing - Theory, News & General
Topic: What evidence would prove the Boglehead mentality wrong?
Replies: 60
Views: 3504

Re: Key to happintess in retirement.

Have a Passion. Much overlooked and very necessary. Don't delay "retirement" too long. Delayed gratification can lead to No Gratification at the drop of a hat. My $.02 If you have a true passion, it couldn't be overlooked. It will be at the forefront of just about everything you do and re...
by Fallible
Mon Sep 15, 2014 7:57 pm
 
Forum: Personal Finance (Not Investing)
Topic: Key to happiness in retirement
Replies: 36
Views: 3603

Re: Key to happintess in retirement.

Interesting how the first article focuses on health and the second considers health so important it's not necessary to include it in the happiness list. I'm retired, full-time for several years now, so while I agree with what both articles had to say, it wasn't really new. My biggest focus is on try...
by Fallible
Mon Sep 15, 2014 5:42 pm
 
Forum: Personal Finance (Not Investing)
Topic: Key to happiness in retirement
Replies: 36
Views: 3603

Re: Good hobby for a bright/obsessive 9 year old?

Hoping for some advice from parents on this one. We have a bright and obsessive 9 year old boy who needs a new hobby. I'm sure he would prefer to play games on the computer but we're sure he could be doing something better with his time and energy. ... If you're looking for a true alternative to hi...
by Fallible
Mon Sep 15, 2014 3:08 pm
 
Forum: Personal Consumer Issues
Topic: Good hobby for a bright/obsessive 9 year old?
Replies: 73
Views: 2880

Re: Recommended Risk assessment questionnaires?

Having searched this forum, I see that opinions of the value of risk assessment questionnaires' are dubious at best. That being said, our son (29) has finally begun to listen to the wisdom of his old man, and now is ready to seriously start investing. I'm looking to connect him to the best question...
by Fallible
Mon Sep 15, 2014 11:39 am
 
Forum: Investing - Help with Personal Investments
Topic: Recommended Risk assessment questionnaires?
Replies: 4
Views: 435

Re: EJ Gadflies [Edward Jones]

... My point (belabored) is that even with the low costs that Bogle brought about, people will do stupid things with their money for reasons that defy logic. Other firms sell better than Vanguard does, and as long as that happens the EJs of the world will continue to thrive. When we do stupid thing...
by Fallible
Mon Sep 15, 2014 11:08 am
 
Forum: Personal Finance (Not Investing)
Topic: EJ Gadflies [Edward Jones]
Replies: 50
Views: 4473

Re: Heads-Up New Indexers

Good to see the new blog and pkcrafter's piece on performance chasing. Look forward to more!
by Fallible
Sat Sep 13, 2014 8:54 pm
 
Forum: Investing - Theory, News & General
Topic: Heads-Up New Indexers
Replies: 2
Views: 869

Re: Introduction

Welcome "cautious" and "passive," two good investor characteristics. In addition to checking out "Getting Started" on our wiki already mentioned here, I'd recommend two books, The Little Book of Common Sense Investing by John Bogle and If You Can - How Millenials Can Ge...
by Fallible
Sat Sep 13, 2014 8:42 pm
 
Forum: Personal Finance (Not Investing)
Topic: Introduction from a new investor
Replies: 8
Views: 734

Re: "A Boring Investor's Gambling Portfolio" -Allan Roth

I said earlier that Roth's advice is good for those who have to play. However, it's clear that Allan does not need this money for retirement. I also think Nisiprius is right, for those who "must" gamble, if the 5% is lost, a new 5% will just be grabbed from the retirement portfolio, proba...
by Fallible
Sat Sep 13, 2014 2:39 pm
 
Forum: Investing - Help with Personal Investments
Topic: "A Boring Investor's Gambling Portfolio" -Allan Roth
Replies: 8
Views: 1526

Re: EJ Gadflies [Edward Jones]

There was a miscommunication. You see when you said you invest through Vanguard you were saying, "there is no chance in H%ll you will get my investments." But he heard, "I have money and I'm already comfortable with risk." He talks to a lot of people who don't have money, or who...
by Fallible
Sat Sep 13, 2014 10:29 am
 
Forum: Personal Finance (Not Investing)
Topic: EJ Gadflies [Edward Jones]
Replies: 50
Views: 4473

Re: "A Boring Investor's Gambling Portfolio" -Allan Roth

I've seen this before, and I don't buy it: So if there is an inner gambler in you, go for it, but do it with preset rules that will minimize your losses. Typically, the gambling portion allocated should be no more than 5 percent of your portfolio. The question is this. Suppose you are someone who i...
by Fallible
Sat Sep 13, 2014 10:08 am
 
Forum: Investing - Help with Personal Investments
Topic: "A Boring Investor's Gambling Portfolio" -Allan Roth
Replies: 8
Views: 1526

Re: Forecasters persistently fail us, yet we keep listening

Personally I believe that people ignore the evidence because there is an all too human need to believe that there's someone who can protect us from bad things happening http://www.etf.com/sections/index-investor-corner/23253-swedroe-forecasters-persistently-fail-us.html Best wishes Larry Enjoyed th...
by Fallible
Fri Sep 12, 2014 2:55 pm
 
Forum: Investing - Theory, News & General
Topic: Forecasters persistently fail us, yet we keep listening
Replies: 6
Views: 540

"A Boring Investor's Gambling Portfolio" -Allan Roth

With all the threads on investing "play" and "fun" money and all the threads on gambling, I thought Boglehead Allan Roth's column was timely and needed to show how - if one MUST gamble - to gamble the safe way. The most important advice, IMO, he summed up last (boldface mine): &q...
by Fallible
Fri Sep 12, 2014 2:14 pm
 
Forum: Investing - Help with Personal Investments
Topic: "A Boring Investor's Gambling Portfolio" -Allan Roth
Replies: 8
Views: 1526

Re: "5 Simple Steps to the Perfect Portfolio"

Thanks for the link, Taylor. It's more helpful advice on how to avoid having too many funds and knowing when is "too many." I liked the "diversifying or di-worse-ifying" and "prudent diversification or imprudent di-worse-ification." LarryG, I also liked Bill Bernstein's...
by Fallible
Fri Sep 12, 2014 1:44 pm
 
Forum: Investing - Theory, News & General
Topic: "5 Simple Steps to the Perfect Portfolio"
Replies: 2
Views: 838

Re: Angry when stock market is down

Does anyone else get angry/edgy/cranky on days where the stock market is down? In the last couple of days, I find little things "set me off". But maybe it could also be other factors in my life. For instance, it's annoying to see REITs down 1.8% today. I won't sell, but I'm just annoyed. ...
by Fallible
Fri Sep 12, 2014 12:57 pm
 
Forum: Investing - Theory, News & General
Topic: Angry when stock market is down
Replies: 79
Views: 3865

Re: Jack Bogle on Diversified Portfolios vs Speculation

Nice interview by Jason Zweig with Jack Bogle Buying and holding stocks and bonds for the long term and maintaining a diversified portfolio are still the smartest strategies for the average investor, says Vanguard founder Jack Bogle in answer to Mark Cuban and other critics of these traditional app...
by Fallible
Fri Sep 12, 2014 12:00 am
 
Forum: Investing - Theory, News & General
Topic: Jack Bogle on Diversified Portfolios vs Speculation
Replies: 5
Views: 778

Re: What Book Are You Currently Reading? Part V

Just starting xkcd cartoonist Randall Munroe’s new book just out, What if?, and looks like fun. Here’s a sampling on money: http://what-if.xkcd.com/
by Fallible
Thu Sep 11, 2014 5:27 pm
 
Forum: Personal Consumer Issues
Topic: What Book Are You Currently Reading? Part V
Replies: 3346
Views: 1147175

Re: What risk-return really means

The real trouble with this world of ours is not that it is an unreasonable world, nor even that it is a reasonable one. The commonest kind of trouble is that it is nearly reasonable, but not quite. Life is not an illogicality, yet it is a trap for logicians. It looks just a little more mathematical...
by Fallible
Thu Sep 11, 2014 1:49 pm
 
Forum: Investing - Theory, News & General
Topic: What risk-return really means
Replies: 41
Views: 2319

Re: The Inner Game of Tennis and Investing

Thank you swaption for the explanation and here is an article on Kahneman that I think pertains to what you're saying and also to Taylor's link on Charles Ellis's sports analogies. Good reading all! From the article: "Kahneman's research has shown that since we use overconfident, highly emotion...
by Fallible
Wed Sep 10, 2014 4:21 pm
 
Forum: Investing - Theory, News & General
Topic: The Inner Game of Tennis and Investing
Replies: 7
Views: 645

Re: How much value can an advisor add for the average invest

I guess another way of asking the question is if you were said advisor, and: 1. You provided all the above noted services 2. You made sure in your yearly meeting with each client to encourage them to manage their own accounts if they can, offer to fill out the VG transfer paperwork for them ... I w...
by Fallible
Wed Sep 10, 2014 3:49 pm
 
Forum: Investing - Theory, News & General
Topic: How much value can an advisor add for the average investor?
Replies: 71
Views: 4271

Re: The Inner Game of Tennis and Investing

Lifetime tennis player here, even now in my 50’s enjoying the game and pushing myself. Currently reading W. Timothy Gallwey’s (now updated) classic The Inner Game of Tennis. Essentially, the book centers around a Self 1 and a Self 2 approach. At the risk of paraphrasing, the Self 1 tends to try and...
by Fallible
Wed Sep 10, 2014 2:00 pm
 
Forum: Investing - Theory, News & General
Topic: The Inner Game of Tennis and Investing
Replies: 7
Views: 645

Re: bogleheads - can I scale it back?

I won't comment on the finances much, but I would just say a hearty word of celebration in your new child. Spending time with your child may be the most rewarding thing you will ever experience, so I wholly applaud your decision to cut back if only for what it will allow over the next few years. Fi...
by Fallible
Wed Sep 10, 2014 10:43 am
 
Forum: Investing - Theory, News & General
Topic: bogleheads - can I scale it back?
Replies: 34
Views: 3982

Re: Anyone moved from NY?

Edit to delete as not live on LI.
by Fallible
Tue Sep 09, 2014 8:42 pm
 
Forum: Personal Consumer Issues
Topic: Anyone moved from NY?
Replies: 43
Views: 2682

Re: When to jump ship?

... In my dreams so far I haven't ever jumped off the ship. ----------------- Calling all Josephs…. Can anyone help me interpret this crazy crazy dream? ... Or, what advice should my Awake Self give to my Dream Self about jumping off the ship? The answer to the first question is that everyone will ...
by Fallible
Tue Sep 09, 2014 5:12 pm
 
Forum: Investing - Help with Personal Investments
Topic: When to jump ship?
Replies: 42
Views: 4812

Re: Rather macabre but necessary question

I'm sorry to hear about your illness and admire you greatly for already planning new adventures. I'm not certain what you mean about how to think about "stuff like this financially." Do you mean immediate retirement, financing your travel, or costs of medical treatment, or house sale, por...
by Fallible
Tue Sep 09, 2014 3:14 pm
 
Forum: Personal Finance (Not Investing)
Topic: Rather macabre but necessary question
Replies: 72
Views: 5341

Re: Simplicity vs. Complexity

One can debate the article's portfolio comparisons forever, but the article's main point is - simply :happy - to properly determine whether the additional holdings justify the additional costs and time . This, IMO, means being honest with oneself about why one is adding to a basically sound and rela...
by Fallible
Tue Sep 09, 2014 1:38 pm
 
Forum: Investing - Theory, News & General
Topic: Simplicity vs. Complexity
Replies: 50
Views: 3310

Re: Rather macabre but necessary question

I'm 61 and still working (for the moment) and I recently received some grim medical news. I have polythycemia vera, a condition where your bone marrow produces an extreme excess of red blood cells. It's incurable and invariably fatal although with treatment it can be held in abeyance for some years...
by Fallible
Tue Sep 09, 2014 12:13 pm
 
Forum: Personal Finance (Not Investing)
Topic: Rather macabre but necessary question
Replies: 72
Views: 5341

Re: J. Zweig - smart investors you should follow - boglehead

Sometime around 2001 I think--can't seem to find the actual article online, anyone have it?--Jason Zweig attended one of the Bogleheads meetings and wrote an article in some familiar-named financial publication, entitled "Here Come the Bogleheads!" He tells of how a photographer, taking a...
by Fallible
Mon Sep 08, 2014 1:02 pm
 
Forum: Investing - Theory, News & General
Topic: J. Zweig - smart investors you should follow - bogleheads
Replies: 19
Views: 2406

Re: What Do You Eat For Snacks?

This certainly doesn't apply to me. I LOVE my bike rides. As an aside, I've been consumed with some projects on my boat for the past couple of weeks and spent 5-6 hrs/day working on them. The work was also quite physical. The only thing I'd eat all day was a sandwich for lunch, a cookie or 2 and ma...
by Fallible
Mon Sep 08, 2014 12:45 pm
 
Forum: Personal Consumer Issues
Topic: What Do You Eat For Snacks? [for exercise-induced hunger]
Replies: 129
Views: 8895

Re: J. Zweig - smart investors you should follow - boglehead

Sometime around 2001 I think--can't seem to find the actual article online, anyone have it?--Jason Zweig attended one of the Bogleheads meetings and wrote an article in some familiar-named financial publication, entitled "Here Come the Bogleheads!" He tells of how a photographer, taking a...
by Fallible
Sun Sep 07, 2014 9:16 pm
 
Forum: Investing - Theory, News & General
Topic: J. Zweig - smart investors you should follow - bogleheads
Replies: 19
Views: 2406

Re: J. Zweig - smart investors you should follow - boglehead

It’s very interesting and thanks OP for the column and livesoft for pointing out the linked blog. I’m all for following calm, methodical people, although I can say that some of the most calm, methodical people I’ve ever known are not good investors, so there’s more to it than those somewhat superfic...
by Fallible
Sun Sep 07, 2014 2:48 pm
 
Forum: Investing - Theory, News & General
Topic: J. Zweig - smart investors you should follow - bogleheads
Replies: 19
Views: 2406

Re: What Do You Eat For Snacks?

In the warmer months I tend to spend a lot of time riding my bike. A typical ride burns ~ 950 calories but the side effect is that it leave me ravenous for much of the day. My biggest problem is that I can't seem to find anything to snack on that relieves the hunger. I love fruit but even a fairly ...
by Fallible
Sun Sep 07, 2014 11:34 am
 
Forum: Personal Consumer Issues
Topic: What Do You Eat For Snacks? [for exercise-induced hunger]
Replies: 129
Views: 8895

Re: Six-Figure Incomes—and Facing Financial Ruin [WSJ articl

As a banker who deals with high net worth clients, I'm not really surprised by any of this. It's absolutely true that most people live paycheck to paycheck - even those folks with really big paychecks. The thing is that many of these people are highly intelligent and apparently fully-functioning me...
by Fallible
Sat Sep 06, 2014 7:16 pm
 
Forum: Personal Finance (Not Investing)
Topic: Six-Figure Incomes—and Facing Financial Ruin [WSJ article]
Replies: 59
Views: 9213

Re: Qualities of a Successful Investor

I think it goes something like this: Ability to delay gratification, ability to control greed, ability stick to a plan. The first relates to living below your means so you have money to invest. The first relates to keep debt low so you can survive the occasional disruption to income without hitting...
by Fallible
Sat Sep 06, 2014 2:59 pm
 
Forum: Investing - Theory, News & General
Topic: Qualities of a Successful Investor
Replies: 9
Views: 502

Re: How exactly would you define market timing?

This is where I see prediction, in the act of identifying "likely" zones. Aren't you really predicting probability or the likelihood of it? Yes, I'm playng the probabilities of bottoming in those zones.... Just the act alone of "playing the probabilities of bottoming" (not why o...
by Fallible
Fri Sep 05, 2014 9:50 pm
 
Forum: Investing - Theory, News & General
Topic: How exactly would you define market timing?
Replies: 67
Views: 1994

Re: How exactly would you define market timing?

Prove you're smarter than the average bear... Make a prediction... As I mentioned before, market-timing is NOT about predictions. It's about playing the probabilities. Then tell me what the probability is that a market crash will happen this year. 50%? 80%? 10%? How deep? 20% drop, 50% drop? 70% dr...
by Fallible
Fri Sep 05, 2014 12:04 pm
 
Forum: Investing - Theory, News & General
Topic: How exactly would you define market timing?
Replies: 67
Views: 1994

Re: How exactly would you define market timing?

I would say the essential condition has to do with trying to make predictions of future market conditions, predictions that cannot reliably be made.... As Charlie Brown once said to Lucy, "THAT'S IT!!!" Also, I think poster ObliviousInvestor nicely applies the prediction condition to Soci...
by Fallible
Fri Sep 05, 2014 11:20 am
 
Forum: Investing - Theory, News & General
Topic: How exactly would you define market timing?
Replies: 67
Views: 1994
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