TIP623: The Art Of Decision Making w/ Annie Duke

We Study Billionaires - The Investor’s Podcast Network

Stig Brodersen

Education, Investing, Business

4.6 • 3.6K Ratings

🗓️ 14 April 2024

⏱️ 73 minutes

🔗️ Recording | iTunes | RSS

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Summary

Kyle Grieve chats with Annie Duke about her own story of quitting and how it helped sparked the idea for one of her books, the importance of base rates in helping us make better decisions, how to improve our investing processes when we have long feedback loops, the importance of using kill criteria to quit an investment or hypothesis, how to use a quitting coach to help you quit things we hold onto for too long, the importance of dissociating ourselves from our most cherished ideas, and a whole lot more! IN THIS EPISODE YOU’LL LEARN: 00:00 - Intro 02:28 - Annie's own story of quitting and how it got here to where she is today. 15:50 - Why expected value is so crucial for investors to manage risk best. 20:15 - The importance of understanding base rates. 20:15 - How we can use base rates to help us best understand expected values of our investments. 24:55 - How we can reframe our analysis of a business to close feedback loops on long-term investments. 32:40 - How we can get transfer from one skill to another far away skill (e.g. chess to investing). 45:28 - How we can use kill criteria in our investing decision-making to improve our abilities to quit a losing investment. 45:28 - How to engineer your decision-making to give yourself an outside view. 51:11 - How we can disassociate ourselves from our investments to reduce the impacts of the endowment effects. 51:32 - How to set up a quitting coach by permitting them to disagree with you. And so much more! Disclaimer: Slight discrepancies in the timestamps may occur due to podcast platform differences. BOOKS AND RESOURCES Join the exclusive TIP Mastermind Community to engage in meaningful stock investing discussions with Stig, Clay, Kyle, and the other community members. Buy Quit: The Power of Knowing When to Walk Away here. Buy Thinking in Bets: Making Smarter Decisions When You Don't Have All the Facts here. Check out Annie’s substack here. Learn more about Annie Duke here. Related Episode: RWH015: Betting Better In Markets & Life w/ Annie Duke | YouTube video. Related Episode: TIP231: The Mind Of A World Poker Champion w/ Annie Duke | YouTube video. Learn more about the Berkshire Summit by clicking here or emailing Clay at [email protected]. Follow Kyle on Twitter and LinkedIn. Check out all the books mentioned and discussed in our podcast episodes here. Enjoy ad-free episodes when you subscribe to our Premium Feed. NEW TO THE SHOW? Follow our official social media accounts: X (Twitter) | LinkedIn | Instagram | Facebook | TikTok. Check out our We Study Billionaires Starter Packs. Browse through all our episodes (complete with transcripts) here. Try our tool for picking stock winners and managing our portfolios: TIP Finance Tool. Enjoy exclusive perks from our favorite Apps and Services. Stay up-to-date on financial markets and investing strategies through our daily newsletter, We Study Markets. Learn how to better start, manage, and grow your business with the best business podcasts. SPONSORS Support our free podcast by supporting our sponsors: River Toyota TurboTax Fidelity Monarch Money Meyka Simon & Schuster CI Financial Vacasa Long Angle Fundrise iFlex Stretch Studios American Express Shopify HELP US OUT! Help us reach new listeners by leaving us a rating and review on Apple Podcasts! It takes less than 30 seconds, and really helps our show grow, which allows us to bring on even better guests for you all! Thank you – we really appreciate it! Learn more about your ad choices. Visit megaphone.fm/adchoices Support our show by becoming a premium member! https://theinvestorspodcastnetwork.supportingcast.fm

Transcript

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0:00.0	You're listening to TIP.
0:02.0	Any Duke has one of the best minds on decision-making I've talked to on we study billionaires.
0:07.0	Decision-making might not sound thrilling at first, but hold on tight because it's the very essence of successful investing.
0:13.0	Think about it. Every trade, every hold, every decision is a product of our mental gymnastics
0:18.1	aimed at maximizing returns and optimizing our process. And Annie, with their background as a legendary poker player turned author,
0:25.2	brings unparalleled insights into this complex arena. In this episode, we're not just
0:29.6	scratching the surface. We're delving into Annie's treasure trove of wisdom honed over years of
0:34.0	intense study and practical experience. Her books, Thinking In Bets, and
0:38.0	Quit, are more than just reads. Their guides to mastering decision-making in
0:41.9	both investing and life.
0:44.0	Today we'll impact some of our most valuable advice to investors to bring more clarity to your
0:47.8	thinking.
0:48.8	We'll focus on our pre-commitment devices, invaluable mental tools that can save us from costing mistakes and lead us
0:53.1	towards smarter, more profitable choices. One of my biggest takeaways from our
0:56.7	chat was how we can create data points on long-term investments. This allows us to
1:00.8	zoom into our process to make sure we are on track for a process that may be many years into the future.
1:06.5	Imagine being able to anticipate the fundamental downturns of a business in your portfolio before the market recognizes it.
1:12.3	Or think about having the ability to more easily walk away from a losing investment
1:16.1	that is burning a hole in your pocket and eating away at your returns.
1:19.8	Annie's insights here alone are worth paying very close attention to.
1:23.6	So if you relish in the intellectual challenge of investing,
1:26.3	this episode is tailor-made for you.
	...

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