The gambler's fallacy in investing

This week's helpful resources: Fabric (term life) and Gelt (small business taxes).

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And now back to the show(notes!) :)

Most investing mistakes don’t feel like mistakes while you’re making them. They feel reasonable. Sometimes they even feel responsible.

In Part 2 of this behavioral economics series, Tyler moves past the “greatest hits” and into the deeper, quieter biases that don’t get talked about as much — but are still quietly wrecking portfolios day after day.

Think album tracks, not radio singles. If Part 1 was Madison Square Garden, this episode is the smaller venue where the real damage happens.

In this episode, Tyler breaks down five lesser-known behavioral biases:

• The Disposition Effect — why we sell winners too early and cling to losers too long

• The Ostrich Effect — how avoiding uncomfortable information can sabotage your plan

• Mental Accounting — why treating dollars differently based on where they came from is costing you real returns

• The Gambler’s Fallacy — how seeing patterns in randomness leads to terrible timing

• The Action Bias — why doing something often feels better than doing the right thing (which is usually nothing)

Along the way, Tyler explains why these behaviors feel correct in the moment, why willpower doesn’t fix them, and why most investors don’t need better predictions — they need better systems.

Automation. Rules. Fewer decisions. Less fiddling.

This episode isn’t about becoming more active or more sophisticated. It’s about accepting a hard truth: successful investing is supposed to be boring. If it’s exciting, you’re probably paying for that excitement with your returns.

If this episode helped you recognize one habit you need to break — or one urge you need to stop indulging — leaving a quick review on Apple Podcasts or Spotify genuinely helps. It helps other people find the show and keeps this whole experiment going.

Until next time, remember: the best investors aren’t the smartest. They’re the ones who do the least amount of dumb stuff.