What I Learned Losing A Million Dollars

Second, being wrong hurts us more than being right feels good. We know from Daniel Kahneman and Amos Tversky’s work on loss aversion, part of prospect theory (which won Kahneman the Nobel Prize in Economics in 2002), that losses in general feel about two times as bad as wins feel good. So winning $100 at blackjack feels as good to us as losing $50

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Forget about investment clubs with friends. It only leads to indecision and bad blood. Don’t ever talk about the market as if it’s your pal – nobody ever understands the market. The pain of a loss is worse than the pleasure of a profit. Don’t ever take a loss lightly. If you get worried and sleep badly, you’re in trouble already. Forget about the t

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It is for this reason that speculation is a game you can’t win. On one hand, there’s the burden of regret resulting from selling too early (or from selling too late at a realized loss). On the other, there’s the schadenfreude you embody by selling right on time. Whichever path the asset ends up taking, there’s a mental tax to be paid on top of any ... See more

You have to continue to be adopting your decision framework. One was whenever I saw a bargain, I should run. It's a sign of no heat. Whenever I did a bargain, I regretted it later. Whenever I was forced to pay up, to date that has been a very good basket of companies