2min snip

We Study Billionaires - The Investor’s Podcast Network cover image

TIP623: The Art Of Decision Making w/ Annie Duke

We Study Billionaires - The Investor’s Podcast Network

NOTE

Distinguishing Luck from Skill in Outcomes

In evaluating outcomes, distinguishing between luck and skill is challenging, especially in a single decision. The speaker illustrates this through the example of betting on a coin flip, emphasizing the need for multiple data points to assess the luck-skill differential. The complexity lies in understanding whether the outcome was a result of luck or skill. By generating more outcomes, such as in frequent poker games, investors can better gauge the effectiveness of their process, as a single outcome may not be indicative of skill. The key is to accumulate sufficient data points to draw meaningful conclusions and assess the influence of luck versus skill in the final outcomes.

00:00

Get the Snipd
podcast app

Unlock the knowledge in podcasts with the podcast player of the future.
App store bannerPlay store banner

AI-powered
podcast player

Listen to all your favourite podcasts with AI-powered features

Discover
highlights

Listen to the best highlights from the podcasts you love and dive into the full episode

Save any
moment

Hear something you like? Tap your headphones to save it with AI-generated key takeaways

Share
& Export

Send highlights to Twitter, WhatsApp or export them to Notion, Readwise & more

AI-powered
podcast player

Listen to all your favourite podcasts with AI-powered features

Discover
highlights

Listen to the best highlights from the podcasts you love and dive into the full episode