The hottest Behavioral Finance Substack posts right now

Safety Not Guaranteed

The Better Letter • 471 implied HN points • 19 Jan 24

Safety in investing and in life is not guaranteed.
Correlation does not imply causation, and certainty in outcomes is rare.
The index mindset favors average results but may overlook opportunities for greater reward and growth.

❄️🧁 Quizz "personnalité d'investisseur"

Snowball • 216 implied HN points • 26 Jan 24

💰 Finance Investing Behavioral Finance Personality Technology

Take a quiz to discover your investing personality
Explore different facets of your investing personality
Learn about a French technology leader in behavioral finance transforming decision-making

Hsieh, Moretti, Shiller, and the Rest: Part 2

Erdmann Housing Tracker • 252 implied HN points • 02 Jan 24

💰 Finance Real Estate Housing Market Behavioral Finance

High housing costs are mainly due to long term rise in rent inflation and decline in housing consumption.
The bubble story contradicts the evidence of high housing costs being a result of economic rents, not productivity.
Robert Shiller's analysis overlooks the importance of considering rent inflation in understanding housing market inefficiencies.

March Madness

Buggy Humans in a Messy World • 1159 implied HN points • 10 Mar 23

💰 Finance Investing Market Analysis Risk management Behavioral Finance

Ignore macro and 'experts', stick to your own investment process
Focus on understanding the intrinsic value of businesses you invest in
Maintain a margin of safety by choosing resilient businesses, act based on price not time

Going for Broke

The Better Letter • 275 implied HN points • 06 Oct 23

💰 Finance Investing Behavioral Finance Risk management Financial Markets Probability

In a coin-flipping experiment, even financially savvy individuals struggled with optimal betting strategies.
The world is far more random than we realize, affecting markets and investments unpredictably.
Probabilistic strategies can help in decision-making, especially when human biases lead to suboptimal choices.

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The Evolution Of Value Investing

Behavioral Value Investor • 170 implied HN points • 09 Jul 23

💰 Finance Investing Value investing Behavioral Finance

Value investing remains rational and involves buying stocks below their intrinsic value.
Intrinsic value is still based on future cash flows and excess assets like in Graham's days.
The importance of fundamental analysis and adapting to technological changes in value investing has increased.

What Are The Dangers And Rewards Of Doubling Down On Your Investments?

Behavioral Value Investor • 89 implied HN points • 30 Apr 23

💰 Finance Investments Risk management Behavioral Finance Value investing Financial Markets

Doubling down on investments can be risky, make sure to assess potential downsides.
Even successful investors can make mistakes and suffer losses by doubling down.
Before doubling down on an investment, consider factors like financial leverage, funding requirements, and management strength.

Why quality stocks perform so well

Klement on Investing • 2 implied HN points • 14 Mar 24

💰 Finance Stocks Investing Market Analysis Risk Behavioral Finance

Companies with higher profitability, known as 'quality stocks,' tend to outperform less profitable companies in the market.
Highly profitable companies do not necessarily come with higher risks, as they have lower probability of share price crashes and tend to perform better in negative market conditions.
The outperformance of highly profitable companies seems to be driven by systematic market mispricing rather than compensation for higher risks, making it a potentially persistent investment strategy.

Risk of Ruin

Net Interest • 24 implied HN points • 13 Oct 23

💰 Finance Risk management Investing Behavioral Finance Portfolio Management Cryptocurrency

Participants in a study about managing financial risk did not fully exploit their edge in a coin-flipping game.
Proper position sizing is crucial in gambling and financial markets to maximize returns and manage risk effectively.
Understanding and applying formulas like Kelly's criterion can help in making optimal bets and improving performance in investing.

It's 2024 and life is still messy

Klement on Investing • 8 implied HN points • 01 Jan 24

💰 Finance Investing Economics Financial Markets Behavioral Finance

Posts are structured with a focus on ESG, economics, and fun on Fridays.
Empirical data is favored over theoretical models in discussions.
Importance of challenging preconceived notions and embracing the messiness of life.

Only academics believe in efficient markets

Klement on Investing • 7 implied HN points • 04 Jan 24

💰 Finance Investing Academics Behavioral Finance

Academics believe in efficient markets where past news does not affect investment decisions.
Non-academics like financial professionals and retail investors do change forecasts in response to old news.
Real markets are not as efficient as academics think, incorporating psychology and fundamentals is important for investing success.

Riding the wave, cynically

Klement on Investing • 5 implied HN points • 16 Jan 24

💰 Finance Investing Stock Market Behavioral Finance

Investors often ride the wave of overvalued stocks based on optimism of others.
Cynical investing involves profiting from unwarranted optimism in the market.
Investing in bubbles can be dangerous as investors may quickly change their belief, causing losses.