Summary of Cullen Roche's Pragmatic Capitalism

Everest Media

Description

Please note: This is a companion version & not the original book.
Sample Book Insights:
#1 The field of behavioral finance is the study of the economy through the psychologically driven actions of its participants. If we know that our economy is little more than the sum of the transactions that occur within it, then understanding the behavior that drives those transactions is paramount in understanding how the system operates.
#2 The human mind is what makes us different from the rest of the animal kingdom. We are extremely intelligent, calculating, and emotional. While these emotions are some of our greatest benefits in everyday life, they are often our worst enemy when it comes to dealing with money.
#3 We are naturally more risk averse, but we can become more irrational when faced with the prospect of losses. We tend to make inefficient decisions when we’re confronted with the possibility of losses.
#4 We are far removed from the animal kingdom, but we still suffer from many of the same strengths and weaknesses. We are designed to respond quickly and inefficiently to threats to our survival. When confronted with money and markets, we often respond irrationally.

Sujets

• Securities
• Investments
• Economie gestion
• General officer
• Economics
• Business
• General

Informations

• Publié par: Everest Media LLC
• Date de parution: 14 mai 2022
• Nombre de lectures: 0
• EAN13: 9798822509962
• Langue: English
• Poids de l'ouvrage: 1 Mo

Extrait

Insights on Cullen Roche's Pragmatic Capitalism
Contents Insights from Chapter 1 Insights from Chapter 2 Insights from Chapter 3 Insights from Chapter 4 Insights from Chapter 5
Insights from Chapter 1

#1

The field of behavioral finance is the study of the economy through the psychologically driven actions of its participants. If we know that our economy is little more than the sum of the transactions that occur within it, then understanding the behavior that drives those transactions is paramount in understanding how the system operates.

#2

The human mind is what makes us different from the rest of the animal kingdom. We are extremely intelligent, calculating, and emotional. While these emotions are some of our greatest benefits in everyday life, they are often our worst enemy when it comes to dealing with money.

#3

We are naturally more risk averse, but we can become more irrational when faced with the prospect of losses. We tend to make inefficient decisions when we’re confronted with the possibility of losses.

#4

We are far removed from the animal kingdom, but we still suffer from many of the same strengths and weaknesses. We are designed to respond quickly and inefficiently to threats to our survival. When confronted with money and markets, we often respond irrationally.

#5

We are all subject to irrational decision-making processes. We are constantly making decisions that are not in our best interest, and it is difficult to overcome our limitations. The best way to overcome our limitations is to recognize them and accept that we know less than we think we do.

#6

The price at which transactions occur is largely the result of the behavior of market participants. The value of a stock can fluctuate relative to the amount of cash in the market. This is most relevant in illiquid markets.

#7

Bubbles are environments in which the market price of an asset has deviated from its underlying fundamentals to the point that its current market price has become unstable relative to the asset’s ability to deliver the expected result.

#8

Because market participants have priced in such high expectations, if the underlying asset does not deliver the returns expected by its owners, the asset is susceptible to substantial downside risk as a repricing occurs to adjust for the price compression.

#9

The market's irrational behavior is caused by the general public's disdain for rising market prices. You feel like you're missing out on gains that could have been yours, when in reality, you don't have to be involved in all the markets' gains all the time.

#10

The market does not care about you or your feelings. When you approach these markets, remember that the less emotionally involved you get, the better off you'll be. Don't fall in love with a financial asset. Fall in love with a process.

#11

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