Success does not consist in never making mistakes but in never making the same one a second time. George Bernard Shaw
All investors, from Peter Lynch to the average Joe, are hard wired with human
emotions. We’re risk averse, we anchor to our purchase point, and we’re all manipulated
by hindsight bias. And when we experience failure, usually it’s self inflicted, which
makes dealing with it objectively a very daunting task. Difficult as it is, we must figure
out how to prevent previous mistakes from interfering with future decisions.
People typically strive to replicate success. Kobe Bryant studied Michael Jordan and
Paul Tudor Jones studied Jesse Livermore. This makes intuitive sense. Others take a
different approach and study stories of failure and try to avoid whatever it is that tripped
that person or company up. Like Charlie Munger said, “Tell me where I’m going to die so
I never go there.”
Everybody makes mistakes, even Warren Buffet, Jesse Livermore, John Bogle. You heard it right. Here’s an enlightening read about the giants of the world of finance, their greatest mistakes and what they learnt from it.