THE WEEKEND BULLETIN (VOL. 1 | ISS. 6)
A weekly digest of some interesting stuff from around the world-wide-web for the discerning investor.
Volume 1 | Issue 6 | December 28, 2019
Section 1: Investing Wisdom
This article offers an interesting argument that i have been thinking about for some time: should investor's pay a premium for investing in illiquid assets? Sounds absurd? Read on to find out why this may actually be good for investors.
How do investors successfully screen for profitable investment ideas from the thousand of stocks listed on the exchanges? While it may be easier to bring down the thousands to hundreds, how does one bring down hundreds to tens? The answer lies in building an anti-universe: stocks that you won’t invest in. This article explains how and why.
‘Made a mistake? Try harder, focus more, be more careful.’ This is a typical response to mistakes. However, beyond a certain basic threshold, it’s not the effort but the system that matters, argues the author of this article. Investors can draw a lesson on the importance checklists and a well defined investment process from this article.
Section 2: Mental Models & Behavioral Biases
We've all had our favorite pens that we used to write exams with - for they were the lucky charm. We've also had a favorite piece of clothing or accessory that improved the chances of winning of the sports star/team that we support. There are days/dates that we think are inauspicious to do something important. Most, if not all, of these relationship between objects and outcomes are imaginations of our mind - superstitions, as we generally call them, or illusory correlations as this article calls it and then goes on to suggest a system for dealing with it.
Section 3: Lessons From History
This report, though slightly dated, is a good read at the close of the year to reflect on some long term historical insights. If not for anything else, it is worth checking out for the charts, some of which are appended below:
Sometimes long term trends can break, for a very long time, like US equities underperforming bonds for nearly two decades!!
The best returns came a long time ago, but the worst happened not so far ago...
Leaders of one era....are no where to be seen in some other era....
Everything said, EMs have not been able to outpace US equity returns...
...or any developed market for that matter...
The world (outside of US) desperately needs better technology adoption and higher entrepreneurial spirits...
Section 4: Personal Development
Looking for a technique to beat procrastination and boost productivity? Author Earnest Hemingway may have an answer.
Section 5: Trivia
Image credit: Read It Forward
Icelanders have a beautiful tradition of giving books to each other on Christmas Eve and then spending the night reading. This custom is so deeply ingrained in the culture that it is the reason for the Jolabokaflod, or “Christmas Book Flood,” - majority of books in Iceland are sold between September and December. Here are some other fun facts about Iceland:
The country has more writers, more books published, and more books read, per head, than anywhere else in the world: 93% of Icelanders read at least one book a year compared to 73% of Americans.
Iceland ranks as the third most literate country in the world (Finland and Norway take the top two spots), as per this study.
One in 10 Icelanders goes on to publish a book, as per this article.
In 2011, Reykjavík was designated a UNESCO City of Literature.
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Signing off on that note, I wish you a wonderful weekend and a very happy new year. See you in 2020.
- Tejas Gutka.
P.S. Click here to read past issues.