Sharing some of my learnings from one of the best books I read in a long time - "A Man for All Markets" by Edward Thorp. 1/n 
Over the course his lifetime, Thorp :
▶️ Was a professor of Mathematics
▶️ Figured out how to beat the dealer at Blackjack
▶️ Built the first wearable computer to predict roulette
2/n
▶️ Was a professor of Mathematics
▶️ Figured out how to beat the dealer at Blackjack
▶️ Built the first wearable computer to predict roulette
2/n
▶️ Fathered Quantitative Finance - Ran a Hedge-Fund that beat the market for 29 straight years
▶️ Predicted the Bernie Madoff Scam 17 years before it blew up
▶️ Is an all round solid guy who decided to gift us his pearls of wisdom through this book
3/n
▶️ Predicted the Bernie Madoff Scam 17 years before it blew up
▶️ Is an all round solid guy who decided to gift us his pearls of wisdom through this book
3/n
One recurring theme is to never believe important anything without verifying for yourself. This is a huge edge to have and Thorp learnt this early on in Life 4/n
Having an edge is important - the surest way to win is to only play those games where you have an edge 5/n
Blackjack (like investing) for Thorp was a game of Math - not luck.
Any luck - Good/Bad cancels itself out over the long run. 6/n
Any luck - Good/Bad cancels itself out over the long run. 6/n
However most gamblers (and investors) DO NOT follow the Math. They insist on playing till they get even. 7/n
Here Thorp (rather his wife) describes why almost everyone sucks at buying stocks :
▶️You buy things you DONT really understand
▶️You then get married to the price you bought at - when in reality that has no meaning to the market - it only matters to you (anchoring) 8/n
▶️You buy things you DONT really understand
▶️You then get married to the price you bought at - when in reality that has no meaning to the market - it only matters to you (anchoring) 8/n
Super interesting chapter on when Thorp met Warren Buffet back in 1967. Buffet told him "he grew his own millionaires😁
Thorp finally bought Berkshire in 1983 when he realised what Buffet had been up to 9/n
Thorp finally bought Berkshire in 1983 when he realised what Buffet had been up to 9/n
Thorp mathematically exposed the $64.8B (yes BILLION) Bernie Madoff Ponzi scheme back in 1991! 17 years before he got caught in 2008.
This story is a Grade A example of Cognitive Dissonance. All swindlers/scamsters know how to prey on this human trait. 10/n
This story is a Grade A example of Cognitive Dissonance. All swindlers/scamsters know how to prey on this human trait. 10/n
Why You can’t be a great investor by listening to consensus 👇 11/n
Why the only people who actually make money on wall street are fund managers 👇
Investors should be very, very sceptical of returns promised by any Fund manager. On an aggregate level - after management fees, it’s just very hard to beat the market. 12/n
Investors should be very, very sceptical of returns promised by any Fund manager. On an aggregate level - after management fees, it’s just very hard to beat the market. 12/n
More Fund Manager shenanigans . "Heads we win, Tails you Lose"
▶️ "Salting the Mine"
▶️ Magic of management fees
▶️ "Cherry Picking"
13/n
▶️ "Salting the Mine"
▶️ Magic of management fees
▶️ "Cherry Picking"
13/n
Why you should put a $ value on your time ⏲️ 14/n
Why it IS sometimes still possible to beat the market (also why it’s so hard)👇 15/n
Using the Kelly Criterion to optimally decide how much to bet on every opportunity 16/n
The chapter on financial crises in itself makes the book worth it. Consequences of limitless leverage : 17/n
Market can stay irrational longer than you can stay solvent 18/n
What someone earns is decided not by the value they produce but by their bargaining power 19/n
20/n Education builds software for your brain 🧠
Learn to teach yourself. 🤓
Learn to teach yourself. 🤓
n/n Princeton Newport Partners Performance ✌️
🐐🙏
