Successful investing depends as much on analytical skills and the quality of available data as on how we think. An intelligent person with enough information can still make a wrong conclusion.
Have you ever wondered why obtaining significantly different diagnoses from the same physicians is common? Did you know that judges have been found more likely to grant parole at the beginning of the day or after a food break than immediately before such a break?
For a few years now, I have been studying best practices in decision making as part of the effort to improve my overall investment results. Most would agree that finding a great business at a good price is the simplest formula for success. But when your favourite company reports a profit warning, is it a signal that your assumptions are no longer valid and you need to sell or is it just a temporary issue and all you need is to remain patient?