16th Apr


Occupation: Blogger

Interests: Stocks

About Me:

I'm a UK based technologist (career) and psychologist (academic) with a long-term interest in financial markets, with a particular emphasis (and skill) in how to not make money out of them. When I'm not working or blogging I'm to be found childminding, walking the dog or hiding in the garden shed with a good book :)

Investment Strategy

Long-term, boring, stock based investing


A Sideways Look at Psychology and Finance

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Timarr's Latest Blogs

It’s an axiom of standard economics that you don’t get above average returns without taking above average risks. No risk, no reward.  It’s an appealing idea, an extension of the entrepreneur's creed: you don't become successful without taking chances.  It’s a meme that’s gone viral, an idea that permeates discussions about investment, drives hard headed analysis and leads us to celebrate the risk taking achievers…

“I made up my mind to be wise and play carefully, conservatively. Everybody knew that the way to do that was to take profits and buy back your stocks on reactions. And that is precisely what I did, or rather what I tried to do..... They say you never grow broke taking profits. No, you don't. But neither do you grow rich taking a four…

Death or (um ... ) Death Apparently the ancient Babylonians would, at the start of each year, promise to pay off their debts and return stuff that they’d borrowed, like the lawnmower (or, as we would refer to it, the neighbor’s goat). As we saw in On Incentives, Agency and Aqueducts  they had good reason to be cautious as the punishment for theft was death.…

“All I want to know is where I’m going to die, so I’ll never go there” - Charlie Munger Carl Gustav Jacob Jacobi was a nineteenth century mathematician famous for his work on elliptic functions, amongst other accomplishments.  Oddly he ends up being frequently quoted by Charlie Munger and Warren Buffett, despite having no known connection with the investment world. I Wouldn't Start From Here…

Christmas is coming, so it’s time for all right-thinking blogs to publish a random list of books in the hope of generating enough income to throw another log on the fire (or at least buy some more books).  These days it’s hard to actually see out of the thicket of new books on the topic behavioral finance, a deluge inversely proportional to the actual impact…

Timarr's Latest Comments

Of that list Soros is a hedge fund manager, but the others are all pure investors.  In fact Buffett wrote about the problems with the EMH in The Superinvestors of Graham and Doddsville back in 1984, and not much has changed in the three decades since. It's not so much that these guys notice the violations in the EMH as that they ignore the whole…

Where are the EMH critics' yachts? Dunno, you'd have to ask them.  Warren Buffett, Charlie Munger, Peter Lynch, Jeremy Grantham, Ben Graham, Walter Schloss, Bill Ruane, John Tempelton, George Soros, John Neff, Phil Fisher: where are your yachts?Anyway, as the article points out, the low volatility anomaly appears to be persistent. Perhaps, as the research suggests, this is because of structural issues in the market.…

Hi Mark I completely agree – on the EMH, on ICAP (LON:IAP) and on Amec (LON:AMEC).  But I’ve come to the view that markets are generally efficient in the longer term and the investing opportunity is about identifying the moments when fear strikes and emotion takes over.  At those times shares get unfairly discounted, so investing at those points generally offers a way of achieving…

Remember that Shiller is a behavioural economist, a few moments with Google is sufficient to reveal his position with regards to CAPM.  Shiller agrees that CAPM represents what people ought to do in terms of portfolio formation, but departs from the strong adherents of efficient markets by arguing that it's not what they actually do because of psychological factors. As such Shiller sits between the…

Hi Paul I completely agree, but you are not most people and I'd venture to suggest that neither are your rich friends. The article, as are all I write, is based on research into the habits and behaviour of average investors, not some specific high functioning subset with the time and aptitude to develop an approach which limits the impact of psychological bias and which…

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