Investment Blunders of the Rich and Famous-- and what You Can Learn from ThemEvery investor -- even the world's most prominent and respected investors -- are subject to the foibles of human psychology. Now, John Nofsinger, identifies the most common investor mistakes through the prism of the world's most public investment catastrophes. Using other people's money and other people's disasters, Investment Blunders teaches a wide range of critical lessons every investor must learn. John Nofsinger shows how to avoid the overconfidence displayed by John Meriwether and David Mullins, and by Nobel laureates Myron Scholes and Robert Merton, the founders of the failed Long Term Capital Management hedge fund. He demonstrates how to avoid the hubris that nearly destroyed KKR in its bidding war over RJR Nabisco; how to identify and control the greed that sank Michael Milken and many of his contemporaries; and how to keep sight of the fundamentals, avoiding the disastrous investments that led to the 1980s' S&L crisis. Read each Blunder, and you will learn of a common error that you can avoid in the future. |
Contents
CHAPTER 1 Other Peoples Problems | 1 |
PART 1 SelfInflicted Common Problems | 11 |
CHAPTER 2 Behavioral Finance | 13 |
CHAPTER 3 Patterns and Predictions | 29 |
CHAPTER 4 Mood Optimism and Investing | 47 |
CHAPTER 5 Profits from the Prophets? | 61 |
CHAPTER 6 Foolish Risks | 83 |
PART 2 Trying to Beat the Market | 101 |
CHAPTER 11 Get Rich Quick | 175 |
PART 3 Colossal Blunders | 191 |
CHAPTER 12 The Eggheads Crack | 193 |
CHAPTER 13 An Orange Squeezed | 213 |
CHAPTER 14 Betting the Bank | 231 |
CHAPTER 15 Invest to Win and Avoid the Blunders | 251 |
APPENDIX Exchange Traded Funds | 275 |
| 289 | |
CHAPTER 7 Timing the Market | 103 |
Performance | 123 |
Carrying the Load | 143 |
CHAPTER 10 The Social Investor | 161 |
Inside Back Cover | 303 |
Back Cover | 304 |
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3Com advertising affect analysts annual return asset allocation bank beat the market behavior Behavioral Finance bond prices brokerage bull market capital gains cash Chapter Citron company stock Consider Deutsche Borse earned economists employees Enron equity ETFs Euronext Amsterdam Euronext Paris example expenses fees financial goals firm-specific risk firms Foolish Four FTSE futures contracts Global hedge fund high returns higher increase Index Fund iShares industry interest rates Internet inves investment blunder investment decisions iShares S&P LDRS Leeson leverage load funds losses LTCM market timers ment million mispricing months mood Morningstar MSCI Europe mutual fund investor mutual funds newsletter Nick Leeson optimism optimistic Orange County outperform overconfidence performance pick predictions problem profits psychological biases purchase pyramid scheme recommendations Robert Citron Sector Index securities sell shares social soft dollar stock market stock price STOXX strategy streetTRACKS taxes tion tors trading transaction costs underperformed Wall Street wealth winners
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