Why managing your bad trades matters more than proving you’re a genius.   Contrary to what your mother told you, you are not a unique little snowflake. And you are certainly not as good at investing as you think you are. This is not a personal attack — it’s a statistical reality. Study after study […]

Everyone knows investors can be impatient. A couple of bad quarters and capital starts running for the exits. Fund managers, in particular, live under the sword of short-term performance. Fall behind the benchmark for a few months and redemptions hit. Careers get judged by the quarter, not the decade. The paper, “Exploiting Myopia: The Returns […]

“The past is never dead. It’s not even past.” -William Faulkner Academics have been trying to explain stock returns for decades with ever more elaborate models. The classic story—Markowitz portfolios, CAPM betas, Fama-French factors—assumes investors rationally update beliefs when new information arrives. While a massive improvement on what came before (nothing), that tidy picture was […]

The “October Effect” is the idea that October is the worst month for stocks. Except it isn’t an effect. It is a myth. If we look at the longest available sample of US index returns (the Dow Jones Industrial Index) from 1896 to 2025, we find this distribution of annualized returns by month. (Source: Barchart) […]

“If you’re so smart, why aren’t you rich?”   Let’s be very clear. It is a great thing to be smart. Being smart is not in any way an impediment to being a good investor. But just as the gift of strength can exacerbate any tendency towards being a bully, intelligence misapplied can lead a […]