Harriman House The Behavioral Investor

I'm about 2/3 of the way through this book and it helps you realize emotional - lazy thinking - pitfalls that can can hurt your long term investment returns. It gives you practical ways to avoid these pitfalls.

Libro para avanzados en el tema. Buena presentación

If you’re the slightest bit curious about Behavioral Finance…this book is an excellent source of nutrition to feed your brain. I have tremendous respect and admiration for an author who can dissect and deconstruct a complex topic into manageable and meaningful sections. Dr. Crosby begins this in the book’s Preface and continues it all the way through the last page of the Epilogue.Full disclosure: I read several reviews and found these phrases to be the one’s I echo:“The first half gives a background and the second half applies the learnings in real life.”“He breaks down the essentials in a clear, easy to understand framework and avoids the pomp and ego that often accompany books written by academics with advanced degrees.”“The author is well read in both academic literature and more practical investing books. Despite the author’s learnedness the language is very readable and clear as Crosby’s writing comes with a humorous and personal touch.”The book is fantastic. It’s entertaining and very well done. Truth be told…I will not lend mine out but I have bought copies for friends, colleagues and clients.

I have read many investment books and I really enjoyed this read. It's a great mix of academic and fun while keeping the reader engaged. I have a deep connection to behavioral finance and the useful understanding of applying this to your own investment plan. I would happily recommend this book to anyone who wants to step up their knowledge and skills for a deeper understanding of how investing works.

In short -This book is mostly about the psychology of long-term investors. Be aware the advice in the book is not applicable for short term investors. This book offers a rich advice on why we choose what we choose and how to choose the best. This book goes by the philosophy that; If you focus on the problem more, the solution will be much easier and more attainable.The Long version -This book is mostly about the mindset of investors. Not necessarily short-term traders, but long-term investors. This book talks about why people make certain decisions. He (the author) says that, to understand the way of trading or investing, we must first understand the minds of those people that created that art (Investing). He says we must focus on understanding the mind of the human being.You see most of us, and our thoughts are mostly inherited from our ancestors. We still possess certain primitive aspects of our ancestor's minds. We still make certain decisions based on those instincts. He talks about certain problems that plague the minds of investors. Just like Einstein said, “when provided with 60 mins to solve a problem, I would spend 55 mins on the problem", the author explains and elaborates on the problems for the entire first half of the book. He takes various studies, focusing on the decisions taken by various people under different circumstances. Sometimes the number of studies mentioned by the author, become overwhelming. Rest aside, I thought the book could be a bit shorter, without all the extra scientific studies.But the author does a very good job in explaining the various psychological aspects that go into investing. He discussed the four basic problems faced by a person when making investment decisions. He concludes the first part by saying that we must understand ourselves. Then he goes discussing the four problems by elaborating and filling my head with a shit load of studies. It became too much. The advice given in the book, is a bit less, but necessary and given the context, it's pretty good. Mainly we are plagued by; Ego, Conservatism, Emotion, fear of risk. These are the four problems faced by investors. The entire first half is about these problems and how we humans have certain tendencies to behave in that way. It's good, the amount of information and details that the author bashes on our heads.The next part of the book is about how can we learn to overcome these certain problems of the investors. To be a good investor we must be cold like a sociopath. We must not succumb to the emotions that the external world bombards us with. He also gives us some practical advice. But the explanation of the problems is lot more than the solutions given. This book is a dense read, trying to read and keep up with the unsurmountable amount of details can be overwhelming sometimes. But we must work hard to learn something. But in the end no matter how much we do our research, there is always a touch of luck in the world of investing. He also concludes by highlighting the rules of value investing and encourages it. The advice is mostly simple, like diversifying, low P/B ratio stocks, investing for the long term. But all the advice is backed up by stupid load of research.