It's a complicated book for me, but it does bring forward simple investment truth to think about.
Here is most interesting from Chapters 1-4.
Question 1: What do you believe is actually false ?
Question 2: What can you fathom that others find unfathomable ?
Question 3: What is the heck my brain doing to blindside me now ?
Quotes I liked:
"Investors hate losses about 2,5 times as much as they
like gains. A 25% gain feels as good a 10% loss. Said otherwise, if you gain 10%
over here and lose 10% over there, you feel like you are behind. This is
commonly known as loss aversion, intimating shortsightedness and overactive
reaction to short-term movements. At root, myopic loss loss aversion and the
mistakes it leads to are about two things – pride and regret"
"Traditional
finance notions derive from traditional notions of economics – that humans in
aggregate act rationally, markets are efficient or at least semi-efficient, and
individuals acting irrationally may be ignored. By contrast, behavioral finance
assumes quirky behavior . Irrationality is assumed to be potential behavior. It’s
true – our modernized skulls contain Stone age brains. Investors aren’t
rational automatons; they are humans and regularly behave in crazy ways when
making financial decisions"
