Algorithms Beat Intuition – the Evidence is Everywhere
Would you trust a computer to drive your car? Google’s self-driving cars are now driving on city streets, and are rapidly becoming better drivers than [...]
Buffett on Institutions: Wit, but no Wisdom?
A student in my class passed along a great quote from one of Buffett's annual letters. Warren Buffett outlines a great story told to him [...]
We are in May–Should we Sell and Go Away?
Tian, the newest team member, did a nice study on the "Sell in May and Go Away" phenomenon. It has been an old axiom in [...]
Media Coverage and Stock Returns
Been thinking about availability bias and how it affects stock returns. This isn't a new paper, but it is interesting nonetheless--An "oldie but goodie." http://papers.ssrn.com/sol3/papers.cfm?abstract_id=971202 [...]
The Golfer’s Dilemma: A Case for Systematic Decision-Making
Many of you may know that golfers often fall victim to mental "distractions" that severely inhibit the quality of their game. However, those "distractions" also [...]
Market Crash Stressing You Out? It Should…
Cortisol Shifts Financial Risk Preferences Kandasamy et al. A version of the paper can be found here. Want a summary of academic papers with alpha? Check [...]
Everything You Wanted to Know About Investing (but were afraid to ask)
I'm new to the crew here, but I'd like to introduce myself. My name is Gabe Kates and I'm currently a student at Haverford College, [...]
Behavioral Finance 101 for Wall Street: Social Anchoring
The “anchoring bias” is firmly established in psychology circles, but a more recent area of focus within the field--social anchoring--is opening up some intriguing new [...]
The Trouble with Non-Transparent Active ETFs
Barron's has an interesting article discussing "The Trouble with Actively Managed ETFs." The article should have been titled "The Trouble with Non-Transparent Active ETFs." A [...]
Do Rituals Make you a Better Investor?
Rituals Enhance Consumption Vohs, J., Y. Wang, F. Gino, and M. I. Norton. A version of the paper can be found here. Want a summary of [...]
Top 10 Rules for Forecasting
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Think You’re Smarter than a Monkey?
BBC has an article discussing the same research we highlighted almost a year ago: Her conclusion is that these biases are so deep rooted in [...]
You shouldn’t buy this stock at any price.
Music to a value investor's ears: You shouldn't buy this stock at any price. Ben Graham advocated that we should always follow a cardinal rule [...]
Natural Gas Trading and Mental Accounting
It has been a long, cold winter on the East Coast. This has been very good for anyone long natural gas. Below is a chart, [...]
The Pursuit of Useless Information: Does this apply to Stock Picking?
Many in the investing world feel that, when assessing securities for purchase, the more information that can be assembled, the better off the investor. In [...]
CFA Institute Magazine Quote: Algos Dreaming
The latest edition of the CFA Institute Magazine has an interesting article on "Do Algorithms Dream of Electronic Clients?" They even managed to quote me as [...]
Woefully Neglected Evidence on Systematic Decision Making
50 Years of Successful Predictive Modeling Should Be Enough: Lessons for Philosophy of Science Our aim in this paper is to bring the woefully neglected literature on [...]
Imagine the World in 2035: No “poor” countries
Bill and Melinda Gates think it is possible: By 2035, there will be almost no poor countries left in the world. Check out the Gates [...]
Models vs. Experts: #15: Do Behavioral cues matter?
Psychiatric diagnoses: A study of how they are made Kendell, R. E. British Journal of Psychiatry, 122, 437-445 An online version of the paper can [...]
The Psychology of Scarcity: Part 2 of 2 (Bonus! Scarcity in Asset Allocation)
How can one optimize performance and decision-making when one is affected by scarcity? This is the subject of Part 2 of our 2-part scarcity series. [...]