STREET DOGS: Some investment beliefs rival religious passion
One of the hardest parts of investing is finding the balance between riding out periods temporarily unfavourable to your views and realising your views are wrong and moving on. It’s the difference between patience and stubbornness, and can separate the ruined from the rich.Admitting being wrong is an admission of wasted effort. And that hurts. This is a big problem in investing. Analysts want to be thorough, digging deep to understand businesses and theories. But effort can repel open-mindedness, which may be more dangerous than no effort at all. The clear ideas are the ones you don’t become emotionally attached to because you haven’t devoted your life to them.It’s easy to convince yourself of something you want to believe. You cling to data that show you’re right and ignore data that show you’re wrong. This not only makes you wrong, but wrong and confident, which is disastrous.In their book Mistakes Were Made (But Not By Me), Carol Tavris and Elliot Aronson write: "A dog may appear...
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