Tali Sharot – Optimism, Decisions, and Mistakes (Capital Allocators, EP.55)
Capital Allocators – Inside the Institutional Investment Industry
Ted Seides – Allocator and Asset Management Expert
4.8 • 806 Ratings
🗓️ 4 June 2018
⏱️ 50 minutes
🧾️ Download transcript
Summary
Tali Sharot is a leading expert on human decision-making, optimism and emotion. A neuroscientist by trade, Tali combines research in psychology, behavioral economics and neuroscience to reveal the forces that shape our decisions, beliefs and inaccurate expectations of the future. She is currently a visiting professor at MIT, and is also an associate professor of Cognitive Neuroscience at University College London where she directs the Affective Brain Lab. Tali is the author of The Influential Mind, The Science of Optimism, and The Optimism Bias.
Our conversation tackles many of the issues Tali has studied in her career, including the optimism bias, sense of control, confirmation bias, behavioral change, and overconfidence. We then touch on some of the applications of her work to investing, including the home country bias, making non-economic financial decisions, active management, emotion-driven decisions, team-based decisions, and research heuristics. Lastly, we learn a few parenting tricks from the Influential Mind.
This conversation took place behind closed doors at the Context Leadership Summit in Las Vegas.
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Show Notes
3:18 – Tali’s educational path to becoming a cognitive neuroscientist
4:58 – Why people make mistakes, optimism bias
7:24 – Does optimism bias impact our view of others as strongly as ourselves
9:12 – What should we do about our optimism bias
12:37 – How does controlling your environment impact how your brain works
14:47 – How do we work around our problems in decision making?
17:40 – How do you get more people to conform to things that are beneficial
21:11 – The impact of different personality types on these tactics
22:05 – How do we use this information to impact financial decisions
23:53 - Home country bias among investors
25:00 – Is home country familiarity a bad thing?
27:12 – Impact of well-being on investment decisions
28:20 – Picking stocks because of the illusion of control
29:52 – The role of emotion in driving our decisions
32:39 – How do you use this information to help individuals or teams make better decisions
36:23 – New research
40:41 – Raising kids
42:29 – Closing questions
Transcript
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