From Rick Ferri's book "All about Asset Allocation" Asset allocation is the most important decision investors can make for their portfolio. "Asset allocation is the cornerstone of a prudent investment plan and is the single most important decision that an investor...
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How can you learn from your decisions?
From Shane Parrish's "Clear Thinking" How can you learn from your decisions? "If you’re a knowledge worker, you produce decisions. That’s your job. The quality of your decisions eventually determines how far you go and how fast you get there. If you learn to...
How can I prevent myself from fooling myself? Make the decision-making process visible.
From Shane Parrish's book "Clear Thinking" How can I prevent yourself from fooling myself? Make the decision-making process visible. The Transparency Principle: Make your decision-making process as visible and open to scrutiny as possible. "Evaluating other people’s...
You need to create fail-safes such as tripwires to overcome inertia and biases.
From Shane Parrish's book "Clear Thinking" You need to create fail-safes such as tripwires to overcome inertia and biases. "The Fail-Safe Principle: Implementing fail-safes will help ensure that your decision is executed according to plan." Example: "Imagine standing...
Shoot Bullets before the Cannonball
From Shane Parrish's "Clear Thinking" You want to shoot bullets before the cannonball. "If you’re still gathering information, don’t get overinvested in just one option. Keep your future options open by taking small, low-risk steps toward as many options as possible...
Margin of Safety
From Shane Parrish's book "Clear Thinking" Why do you need margin of safety? "You don’t always need to have the ultimate solution to make progress. If it remains unclear which path is best, often the next best step is just to eliminate paths that lead to outcomes you...
How can I get accurate information?
From Shane Parrish's book "Clear Thinking" How can I get accurate information? "When it comes to getting information that’s accurate, there are two principles you should know: the HiFi Principle and the HiEx Principle. The first will help you find the best intel...
Evaluate the options
From Shane Parrish's book "Clear Thinking" How do you evaluate the options? "You’ve worked out some potential solutions in detail. Each suggests a course of action that might work. You now need to evaluate the options and pick the one most likely to make the future...
Key Takeaways from Explore Possible Solutions
From Shane Parrish's book "Clear Thinking" Here are the key takeaways from Explore Possible Solutions: "Once you’re clear on the problem, it’s time to think of possible solutions—ways of overcoming the obstacles to get what you want. The way to come up with possible...
Key Takeaways from Define the Problem
From Shane Parrish's book "Clear Thinking" The first principle of decision making: Define the problem "The first principle of decision-making is that the decider needs to define the problem. If you’re not the one making the decision, you can suggest the problem that...