Our Maladapted Brains (A look at investing via evolutionary psychology)

Our brains have done the vast majority of their evolving in the distant past before civilization. The adaptations we have were arguably more oriented towards hunting and gathering than buying and selling stocks. Michael Zweig gave an interview to Vanguard magazine about the ways in which our brains are unsuited for investing. In short, we tend to think relatively short term and act on our emotions, which can sometimes make us choose bad choices. Listen to the original interview, read the transcript, or read a shortened summary.

One rule I like is, if the market is open, your portfolio should be closed.

If on any given day the market news is frightening to you, then the resolution you should make is, “I’ll act on this tomorrow.” And merely sleeping on it and waiting until the next morning may change your viewpoint just enough so that you can be objective.

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Adam and the Amethysts

My friend Adam has a new record out, and it’s some pretty great indie rock/pop. His site will let you download 5 tracks from the album in MP3, but you should buy it if you like it. His MySpace Page has tour dates and some other info.

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