Capital Allocators – Inside the Institutional Investment Industry Michael Mauboussin – Who’s on the Other Side (Capital Allocators, EP.99)
4 snips
May 13, 2019 
Michael Mauboussin, an esteemed investment strategist at Blue Mountain Capital, dives deep into his research on investment processes versus outcomes. He emphasizes the importance of understanding investor edges, explores psychological biases affecting market strategies, and discusses decision-making dynamics in both public and private markets. The conversation also touches on the intriguing relationship between data analytics and sports like lacrosse, highlighting how analytics can transform both finance and athletics. Prepare for insights that could reshape your investment approach!
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Process over Outcome
- Evaluate investment processes, considering skill, luck, and robustness.
- Constantly reassess if the process remains sound, analytically, behaviorally, and organizationally.
Market Dynamics
- Investors compete against the market, a complex system, not just other individuals.
- Consider group behavior and market dynamics, not just individual biases.
Behavioral Edges
- Over-extrapolation is a common behavioral pattern in probabilistic decisions.
- The wisdom of crowds can turn into madness with correlated beliefs, so examine contrarian viewpoints.
