A Curriculum For Active Investors

As an active investor, what are all the different things we need to know? I think we need to know: - A bit of economics: the fundamentals of micro and macro economics: how economic incentives and constraints shape human behavior, the history of capitalism and its enormous power to create wealth for business owners, etc. - A bit about how businesses work: how they compound capital and generate returns for their owners, the magic of retained earnings, etc. - A bit about accounting and financial statements: how to read and interpret them, how to use them to distinguish wonderful businesses from so-so ones, how to read 10-Ks and 10-Qs, etc. - A bit of financial modeling: the basic math behind predicting and evaluating financial time-series, cash flows, IRRs, inflation adjustments, etc. - A bit of probability and decision making under uncertainty: the logic behind diversification and portfolio construction, intelligent re-balancing, the pitfalls of averages and expectations, the math of survival (Lindys vs Turkeys), statistical significance, distinguishing luck from skill, the fundamentals of intelligent risk management, etc. - And finally, a bit about our own psychology: common biases we tend to harbor, slow thinking vs fast thinking, survivorship bias, how fear and greed and envy shape our behavior in markets, etc. In this episode, we’ll go over this “curriculum” — the various topics in it and how investors can efficiently learn these topics and put them to practical use. DISCLAIMER: None of this is investment advice. Download the Callin app for iOS and Android to listen to this podcast live, call in, and more! Also available at callin.com