Why Do We Apply Loss Aversion to Stock Market Investing?

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We apply loss aversion asymmetrically to the status quo, or the things that we're already doing. We don't think every morning that we're starting it fresh. Sarah Olstam-Rutinas had been unhappy for three years at her job and was worried she wouldn't be happy when she switched jobs. She quit the next day after hearing a TED Talk by David Frum about how people can become biased in their thinking.

Annie Duke is a former poker player and author. She holds a World Series of Poker (WSOP) gold bracelet from 2004 and at one point won more money in WSOP history than any other female. She is still in the top four as of September 2021, despite being retired from poker, last cashing at a tournament 2010.

She is the author of three phenomenal books Thinking In Bets, How To Decide, and Quit.

In this conversation, we spoke about how Annie got into poker, how to decide whether to quit a job or relationship, and what she learned from Erik Seidel.

(0:00) Intro

(3:13) Getting Into Poker

(19:59) Visual Memory

(22:00) Annie’s Poker Mentor

(27:21) Breaking Down Decision Making

(30:43 Dr. Olstyn Martinez

(39:39) Maintaining Identity

(44:11) Deciding In Advance

(48:56) Quitting A Relationship Or Job

(53:30) What Does Annie Want People To Take Away?

(59:20) Challenge

Annie’s Links