Quote for the Week
After a stock market decline, people may perceive more risk than before when, in fact, the decline may have taken some of the risk out of the market. I haven’t quantified this, but I believe risk perceptions probably move around more than risk preferences do. — Robert Shiller (source)
Quarterly Reading
Here’s what I’ve been reading for the past three months:
- 100-to-1 in the Stock Market — Thomas Phelps studied companies that grew 100x on an initial investment to find common characteristics for their success. It is a very early explanation for “moats” along with the necessary traits investors need to stick with a company for the long run. There is some useful information, just be aware of the obvious hindsight bias at play. (notes)
- The Art of Execution — The author studied the investment results of fund managers and shares the common habits that improved and hurt their returns. In both cases, the habits are tied to a mix of strategy and behavior. (notes)
- Little Bets — Peter Sims describes the process many innovators go through. They make hundreds to thousands of tiny bets, failing, learning, and adapting along the way until they come up with a successful product. The similarities with investing are apparent. (notes)
- The Autobiography of Charles Darwin — The book was written for his family and never meant to be publicly available. Darwin summarizes his life: his research, learning process, writing process, and the reasons he believed were behind his success. He had an early interest in natural history and held that focus throughout his life. He comes off as extremely humble in his writing. It was an interesting read. (notes)
- The Panic of 1907 — The book tells the story of the 1907 bank run and market panic, from the events that lead up to it to the aftermath that led to the creation of the Fed. It’s been on my shelf for a few years and the recent bank run was a good excuse to finally read it. (notes)
- Value Investing Makes Sense — Jean-Marie Eveillard shares his personal views and experiences as a fund manager to explain why value investing made sense to him. I’ll have more to add once I finish it.
Last Call
- The Seven Virtues of Great Investors – J. Zweig
- One of the Biggest Mistakes in Investing – A Wealth of Common Sense
- Leverage is Brittle – S. Godin
- When Direct Indexing Truly Pays – J. Rekenthaler
- A History of Investment Vehicles From 1774-2023 w/ J. Catherwood (podcast) – The Long-Term Investor
- How a War Over Eggs Marked the Early History of San Francisco – LitHub
- Is AI Fear this Century’s Overpopulation Scare? – Pessimists Archive
- The Age of Average – A. Murrell
- The Gamber Who Beat Roulette – Bloomberg