Mental Models, Chow Yong Han, Page 3

Business and Life are full of temptations

(Excerpt from Invested by Charles Schwab) The world of business, like the rest of life, is full of wonderful temptations, and making a choice about where you are going to devote your energy is often as much about...

October 24, 2020| Business, Focus, Life, Via Negativa Read More

Ben Graham kept changing his investment formulas and ultimately investing became too competitive

(Excerpt from The Psychology of Money by Morgan Housel) Graham was constantly experimenting and retesting his assumptions and seeking out what works—not what worked yesterday but what works today. In each revised...

September 28, 2020| Adaptability, Investing Read More

Time is the important driver of investment returns

(Excerpt from The Psychology of Money by Morgan Housel) As I write this Warren Buffett’s net worth is $84.5 billion. Of that, $84.2 billion was accumulated after his 50th birthday. $81.5 billion came after he...

September 26, 2020| Investing, Nonlinearity Read More

Focus on staying in the game until the odds fall in your favour

(Excerpt from The Psychology of Money by Morgan Housel) The trick when dealing with failure is arranging your financial life in a way that a bad investment here and a missed financial goal there won’t wipe...

September 26, 2020| Investing, Luck, Randomness Read More

Super successful individuals are cases of extreme luck

(Excerpt from The Psychology of Money by Morgan Housel) …focus less on specific individuals and case studies and more on broad patterns. Studying a specific person can be dangerous because we tend to...

September 26, 2020| Luck, Randomness, Success, Survivorship Bias Read More

Ben Graham’s return was largely delivered by GEICO

(Excerpt from The Psychology of Money by Morgan Housel) Benjamin Graham is known as one of the greatest investors of all time, the father of value investing and the early mentor of Warren Buffett. But the majority of...

September 26, 2020| Investing, Luck, Randomness Read More

Express your confidence in the accuracy of your belief in percentages

(Excerpt from Thinking In Bets by Annie Duke) … we also rated our level of confidence about the accuracy of our belief on a scale of zero to ten? Zero would mean we are certain a belief is not true. Ten would...

August 22, 2020| Confirmation Bias, Ego, Fallibility, Overconfidence Bias Read More

Making a life choice is a bet on a future version of us

(Excerpt from Thinking In Bets by Annie Duke) In most of our decisions, we are not betting against another person. Rather, we are betting against all the future versions of ourselves that we are not choosing. …...

August 16, 2020| Life, Luck, Optionality, Path Dependence, Randomness, Success Read More

Be adaptable like water

You must be shapeless, formless, like water. When you pour water in a cup, it becomes the cup. When you pour water in a bottle, it becomes the bottle. When you pour water in a teapot, it becomes the teapot. Water can...

August 14, 2020| Adaptability, Ego, Learning Read More

Know when your maps are not useful

(Excerpt from The Great Mental Models Volume 1: General Thinking Concepts by Shane Parrish) But what physicists do so well, and most of us do so poorly, is that they carefully delimit what Newtonian and Einsteinian...

August 11, 2020| Circle of Competence, Fallibility, Map Is Not Territory, Structure drives behaviour Read More