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More Than You Know: Finding Financial Wisdom in Unconventional Places
     

More Than You Know: Finding Financial Wisdom in Unconventional Places

5.0 1
by Michael Mauboussin
 

ISBN-10: 0231138709

ISBN-13: 9780231138703

Pub. Date: 06/01/2006

Publisher: Columbia University Press

LEARN HOW GREAT INVESTORS THINK

Michael J. Mauboussin is known throughout the financial world for his innovative approach to succeeding on Wall Street. His unconventional methods have earned him a place on Smart Money's list of the "Most Influential People on Wall Street" and in the Wall Street Journal's All-Star survey. In More

Overview

LEARN HOW GREAT INVESTORS THINK

Michael J. Mauboussin is known throughout the financial world for his innovative approach to succeeding on Wall Street. His unconventional methods have earned him a place on Smart Money's list of the "Most Influential People on Wall Street" and in the Wall Street Journal's All-Star survey. In More Than You Know, Mauboussin shares his secret to becoming an insightful investor and provides invaluable tools to better understand the concepts of choice and risk.

Mauboussin develops sound investment strategies by drawing on diverse sources and disciplines. He builds on the ideas of sage yet diverse visionaries including Warren Buffett and E. O. Wilson, but he also finds wisdom in a range of activities and fields that is both broad and deep, including: casino gambling, horse racing, psychology, and evolutionary biology. He analyzes the strategies of poker experts David Sklansky and Puggy Pearson and pinpoints parallels between mate selection in guppies and stock market booms. Ant colonies, Tupperware parties, "hot hands" in basketball, slime mold, and Tiger Woods's swing all have something to tell us about smart investing.

More Than You Know is written with the professional investor in mind but extends far beyond the world of economics and finance. Mauboussin groups the essays into four categories: Investment Philosophy, Psychology of Investing, Innovation and Competitive Strategy, and Science and Complexity Theory, and he includes useful references for further reading on the topics he discusses. A true eye-opener, More Than You Know shows how a multidisciplinary approach thatpays close attention to process and the psychology of decision making offers the best chance for long-term financial results.

Product Details

ISBN-13:
9780231138703
Publisher:
Columbia University Press
Publication date:
06/01/2006
Edition description:
Older Edition
Pages:
268
Product dimensions:
6.10(w) x 9.10(h) x 1.10(d)

Table of Contents

Acknowledgments
Introduction
1. Be the House: Process and Outcome in Investing
2. Investing -- Profession or Business? Thoughts on Beating the Market Index
3. The Babe Ruth Effect: Frequency Versus Magnitude in Expected Value
4. Sound Theory for the Attribute Weary: The Importance of Circumstance-Based Categorization
5. Risky Business: Risk, Uncertainty, and Prediction in Investing
6. The Hot Hand in Investing: What Streaks Tell Us About Perception, Probability, and Skill
7. Time Is on My Side: Myopic Loss Aversion and Portfolio Turnover
Part 2: Psychology of Investing
Introduction
8. Good Morning, Let the Stress Begin: Linking Stress to Suboptimal Portfolio Management
9. All I Really Need to Know I Learned at a Tupperware Party: What Tupperware Parties Teach You About Investing and Life
10. All Systems Go: Emotion and Intuition in Decision Making
11. Guppy Love: The Role of Imitation in Markets
12. Beware of Behavioral Finance: Misuse of Behavioral Finance Can Lead to Bad Thinking
13. Raising Keynes: Long-Term Expectations, the El Farol Bar, and Kidding Yourself
Part 3: Innovation and Competitive Strategy
Introduction
14. The Wright Stuff: Why Innovation Is Inevitable
15. Pruned for Performance: What Brain Development Teaches Us About Innovation
16. Staying Ahead of the Curve: Linking Creative Destruction and Expectations
17. Is There a Fly in Your Portfolio? What an Accelerating Rate of Industry Change Means for Investors
18. All the Right Moves: How to Balance the Long Term with the Short Term
19. Survival of the Fittest: Fitness Landscapes and Competitive Advantage
20. You'll Meet a Bad FateIf You Extrapolate: The Folly of Using Average P/Es
21. I've Fallen and I Can't Get Up: Mean Reversion and Turnarounds
Part 4: Science and Complexity Theory
Introduction
22. Diversify Your Mind: Thoughts on Organizing for Investing Success
23. From Honey to Money: The Wisdom and Whims of the Collective
24. Vox Populi: Using the Collective to Find, Solve, and Predict
25. A Tail of Two Worlds: Fat Tails and Investing
26. Integrating the Outliers: Two Lessons from the St. Petersburg Paradox
27. The Janitor's Dream: Why Listening to Individuals Can Be Hazardous to Your Wealth
28. Chasing Laplace's Demon: The Role of Cause and Effect in Markets
29. More Power to You: Power Laws and What They Mean for Investors
30. The Pyramid of Numbers: Firm Size, Growth Rates, and Valuation
Conclusion. The Future of Consilience in Investing
Notes
References and Further Reading
Index

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5 out of 5 based on 0 ratings. 1 reviews.
Guest More than 1 year ago
This book began as a series of 50 short essays Michael J. Mauboussin wrote for investors. He advocates using a multidisciplinary perspective to try to understand how markets behave. By its nature as a collection of essays, this book is capricious and desultory, jumping around from subject to subject. The essays do not necessarily relate to each other, but that has some advantages, given the author's belief in multiple analyses. His book is not the place to seek a sound, consistently argued theory about why the market does what it does. On the contrary, Mauboussin repeatedly contends that no one really understands why the market acts the way it acts. In fact, he says, attempts to explain it often rely on patterns that aren't really there. We highly recommend this book as an excellent antidote for the disease of being overconfident about the wisdom of prevailing financial and economic opinions.