To my mind this story is part of reality but far from all of it. Many of my investment theses reflect market over-reactions driven by recency bias. (I only hold individual company stocks.) If a REIT shows a one-quarter increase in tenant defaults, the market acts as though this will be permanent or even accelerating. I've made a lot of money investing counter to those over-reactions. When the price on such a stock recovers, it is not that the facts change, but that the market stops believing the erroneous assumptions that drove the price down. The assumptions built into the price change but the facts on the ground do not.
Sometimes can be a pretty powerful word. Certainty feels good to the human body, it feels strong. Sometimes feels wishy-washy and uncertain. But it is the knowledge that sometimes things work and sometimes they don’t that makes us better long term investors.
Love the format/delivery. Looking forward to more of these
This was really good.
To my mind this story is part of reality but far from all of it. Many of my investment theses reflect market over-reactions driven by recency bias. (I only hold individual company stocks.) If a REIT shows a one-quarter increase in tenant defaults, the market acts as though this will be permanent or even accelerating. I've made a lot of money investing counter to those over-reactions. When the price on such a stock recovers, it is not that the facts change, but that the market stops believing the erroneous assumptions that drove the price down. The assumptions built into the price change but the facts on the ground do not.
Sometimes can be a pretty powerful word. Certainty feels good to the human body, it feels strong. Sometimes feels wishy-washy and uncertain. But it is the knowledge that sometimes things work and sometimes they don’t that makes us better long term investors.