Thinking Fast and Slow by Daniel Kahneman

 

Book No. 2: Thinking Fast and Slow by Daniel Kahneman

Thinking Fast and Slow book cover

(Source: Amazon.com) 

Thinking Fast and Slow is a book about how we think and make judgments in all aspects of our life, not just investing. Knowing why we make decisions will help investors will make their processes more thoughtful and avoid common mistakes.

Investing can be high stakes and stressful, and our choices should be deliberate and consistent… rather than emotionally driven and erratic. To improve decision-making, investors must learn a new way to talk about it and identify their faults. As Kahneman points out…

In at least some cases, an accurate diagnosis (of bad decision patterns) may suggest an intervention to limit the damage that bad judgments and choices often cause.

If you have looked back at your trading record and wondered why you didn’t sell when you knew you should or how you wound up with a terrible stock in your portfolio, this is the book for you.

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