Paul Farrell asks investors to be honest with themselves:
“How successful are you as an investor? You a winner? If not, why not? Are you too smart? Maybe too dumb? Too irrational? Uninformed? Deck stacked against you? Too manipulated to invest successfully in today’s uncertain, volatile, insane markets?
Farrell channels Ray Dalio and asks 5 questions that requires investors getting brutally honest with themselves. Find out what’s going on inside your own brain by asking if you are:
1. Accurate? Information tested accurate and truthful
2. Biased? Facts you believe are true but are false
3. Denials? You know the truth, but refuse to accept it
4. Wishful thinking? Unpredictable future, you’re guessing
5. Black swans? Disasters we could plan for, but don’t
Most people are not very enlightened about their own biases and prejudices. If you want to make better investment decisions, you best figure out how you are undercutting yourself.
Go read the full piece . . .
5-part IQ test to make you a better investor
Paul B. Farrell
MarketWatch, Aug. 10, 2012