Description
INTRODUCTION: THE PATH OF LEAST RESISTANCE CHAPTER 1: MAKING SENSE OF WHAT YOU SEE Anchoring: An Invisible Hand Representativeness: If it Walks Like a Duck Money Illusion: The Rule of 72 and the Risk of Inflation Recency Effect: A Clear and Present Danger Reversion to the Mean: That Makes Sense but Doesn’t Answer Anything Availability Bias and Distortion: Overestimating What You Can Easily Recall Familiarity Bias: Recognizing a Stranger Proportional Money Effect: Why We Save Pennies Only to Neglect Dollars Mental Accounting: Pigeonholing Money Endowment Effect: Loyalty Reward Points are Not Free Money Status Quo Bias: The Influence of Inertia CHAPTER 2: CONTROLLING RISK Conservativism: Close but No Cigar Gambler’s Fallacy: Heads or Tails? Possibility and Certainty Effect: A Bird in the Hand is Worth Two in the Bush House Money and Break-Even Effect: What Just Happened? Disposition Effect: The Worst Time to Lock in a Profit Loss Aversion and False Risk Control: Anti Up! CHAPTER 3: WANTING TO BE RIGHT Overconfidence: We All Can’t Be Above Average Hindsight Bias is Convincing: I knew it! Cognitive Dissonance: The Grapes Were Sour Anyway Confirmation Bias: Buying and Selling a Boat Availability Bias, Recency Effect and Real Estate: House Prices Always Rise, Right? Sunk Cost: Why Camping Seems Affordable Barnum and Forer Effect: A Fool is Born Every Minute Loss Aversion Undermines Your Beliefs: Trading Money for Sleep Herd Mentality: Consensus Hurts Performance CHAPTER 4: DEVELOPING YOUR PERSONAL ECONOMIC VALUES Why Commit to the Eight Steps? Personal Economic Values Workbook CHAPTER 5: ADOPTING UNBIASED HABITS The Point of Impact Don’t Take it Personally Quantify your returns Keep a Journal of Investment Decisions The Power of SMT Negotiations Just Pick One Automate, Outsource, and Schedule Stop Checking Your Investments Establish Investment Constraints Reframing Decisions No Safety in Numbers Money Doesn’t Care Where It Came From Craft Your Personal Investment Policy Statement I Knew-It-All-the-Time Cut Your Losses Trees Don’t Reach the Sky In the Absence of Research Be Average The Unbiased Habit Checklist CHAPTER 6: WHAT AN INVESTMENT ADVISOR CANNOT DO The Bottom Line Bull Markets and DIY Is Passive Investing a Silver Bullet? Intuition Avoiding Hindsight Bias with Training When to Trust Expert Investment Advice Know What You Don’t Know Bias Resistance Portfolio Abandonment CHAPTER 7: CAN MONEY BUY YOU HAPPINESS? Happiness, Work, and Retirement Happiness and Spending Money Happiness and Gluttony Health, Happiness, and Your Money How Much is Enough?
