The Ledger
Every statement that passed quotation and attribution checks. Mix any filter with any other: certainty 1/5, debate potential 5/5, or both at once.
why aren't all 12 resolved? a statement only gets an assessment when the public record can support or contradict it. opinions and what-ifs never can, and 0 checkable ones are still open, waiting for their date. predictions held up or didn't; assertions are supported or contradicted. on every card: ▮▮▮▮▮ certainty · ▮▮▮▮▮ debate potential. speakers are clickable
Flynn Levy: Nudge-prompted portfolio trades are usually more successful than normal trades
“And what we find is that they are more successful than your normal trades, usually.”
Flynn Levy: Contentious investment committee decisions often outperform unanimous ones
“And what we found so far is sometimes contentious decisions are the better decisions. For some people anyway, and for the first firm that we did this with, that was the case, which is, and particularly around whether, so when they would vote unanimously on som…”
Flynn Levy: Managers who capture behavioral alpha will survive industry headwinds
“A lot of active managers will leave because it is getting so much harder to have a competitive advantage. But the ones who have behavioral alpha advantage, you know, where they actually are looking at their own behavior and saying, I want to continuously impro…”
Flynn Levy: Forcing portfolio managers to pause leads to better decisions
“What we find is that people's behavior changes, so when you do that, people do make a better decision, and it's not because we've told them what decision to make, it's because we've told them to pause and make a decision, whatever that decision is.”
Flynn Levy: Most active portfolio managers possess genuine underlying investment skill
“I see managers, it's like I look at x-rays all day long of different managers, and I see a lot of skill. It's quite rare that I see somebody where you're like, oh god, you should really find a different occupation. Usually there's something to work with”
Flynn Levy: Most fund managers capitulate at bottoms due to loss aversion
“The vast majority of fund managers, not surprisingly, show evidence of loss aversion around exit timing when prices have been on a negative trend, or a positive one if they're short. So when the price is moving against you, the tendency is to hold on for too l…”
Flynn Levy: Disposition effect is less prevalent in professional managers than retail
“We definitely do sometimes see the disposition effect as an extension of the loss aversion point, so not just holding on losers for too long, but cutting winners early. Less prevalence in professional fund managers than in retail investors, though.”
Flynn Levy: Fund managers excel at contrarian entries but herd at tops
“You often see evidence of hurting around entry timing and that sort of, people are often very good at contrarian entry timing, catching it, you know, an inflection point quite well. But when something's been moving their way for a while, Take, say, a three-mon…”
Flynn Levy: Portfolio manager behavior is remarkably stable over time
“What's fascinating and sort of unexpected to me, having analyzed a lot of different portfolio managers' data going back long, you know, periods of time in some cases, is that people's behavior is very stable.”
Flynn Levy: Asymmetric payoff and consistency define fund management success
“The consistency with which they can get those decisions right, and the extent to which they can get the ones right really right, and the ones that get wrong only a little bit wrong, that is the key to success in fund management.”
Flynn Levy: Every equity investment decomposes into distinct sub-decisions
“No matter what you're doing, for any equity investment, you're making a picking decision, you're making an entry timing decision, you're making a decision about how big to go, and how quickly to get there, and adding and trimming decisions while you're in ther…”
Flynn Levy: Feedback loops decouple emotional failure from constructive decision learning
“If you start thinking about things in terms of feedback loops, then failure becomes a very valuable learning experience, and it gets easier and easier to separate the emotion of failing, you know, or getting something wrong from the learning, and recognize the…”