People have two kinds of thinking systems: fast thinking depends on intuition, slow thinking depends on reason, and slow thinking is often difficult for people to choose when to use fast thinking and when to use slow thinking.
"Thinking, Fast and Slow " tells us under what circumstances can we trust our intuition and when can we comply with our own rationality, and guides us how to make better choices in life and investment.
1
Fast and slow thinking
Quick thinking: rely on intuition, make judgments quickly through emotions, memory and experience, stick to the principle of "seeing is facts", and it is easy for to lose, hate and optimism to guide us to make wrong judgments.
Slow thinking: Rely on reason and analyze and solve problems by mobilizing attention. It is slow, but also lazy. Sometimes it directly adopts intuitive judgments, and sometimes it considers rationality.
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Why do we make wrong decisions?
The wrong choice was made because slow thinking gave the decision-making power to quick thinking, and people directly believed in intuition without considering rationality.
For example, paying attention to someone's voice in a noisy and crowded room and looking for someone, this requires concentration, and what it mobilizes is slow thinking. And when determining where the sudden sound source is, and hearing the unfriendly voice of someone's speech, these reactions are chosen in Kuaishou.
The operation of slow thinking requires concentration, but humans are naturally lazy and are often unwilling to consume attention. The stop of attention will terminate the operation of slow thinking. If you rely too much on intuition, you will often be confused by the appearance of things and be unaware of them, which will be deceived, leading to mistakes and prejudice in the thinking process.
If you think slowly and be lazy, let quick thinking take on the important task of making decisions, this is the root cause of our irrational judgment.
3
What are the ways to think about what may lead to wrong decisions?
. When thinking, paying too much attention to the explanation of causes and consequences. Human thinking tends to find causality and performance will find reasons for the rise and fall of the stock market, but in most cases the market trend fluctuates randomly. For example, when we study the short-term rise and fall of stocks, it is often difficult to come to a conclusion because the environment is complex and changeable, and the formation of the K-line may be due to the interaction of countless factors. Negative effects of
, psychological account . people always seek profit and avoid harm, which will lead to people selling profits and retaining losses.
. The negative impact of the difficulty of finding arguments. The simpler the support argument is, the more people will often have a great increase in confidence. For example, popular stocks are more likely to find good news, but more difficult to find negative news, so funds will have more confidence in bearishness and stocks will easily rise. On the contrary, for stocks that are not optimistic about the market, it will be difficult to find positive information, so capital confidence generally declines, and stocks are prone to oversold and .
. The ratio of basics is ignored. events easily appear in the mind, which can easily inspire intuitively-led quick thinking, resulting in ignoring the basic ratio information and making wrong decisions. For example, in the market downward trend, people are more likely to think of the advantages of their stocks, and even think that the stocks in their hands may rise reversibly, and ignore that in the downward trend, the ratio of stocks that can counter the market is actually very low.
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differences in thinking?
, Intuitive thinking is silent, that is, it is difficult to control. Actions, mood, relaxation or tension, or fatigue will affect whether people adopt intuitive thinking. We must always reflect on whether the current intuition is rational.
. People often fail to consider the information they have not yet mastered, but believe that the eyes are true. is manifested as people think that impeccable logic is the result of high certainty, but the facts are often not the same as logic, because there is a large amount of unknown information that affects the certainty of judgment. So in investment, even if we are optimistic about a certain industry, we must prevent unknown risks. Diversifying investment is a good way.
. The human brain cannot properly handle what has not happened. People's reflection on history is less than that of self-awareness. For example, when reviewing successful investments, people often ignore the decisive power of luck and history will not simply repeat it.
. It is difficult for people to reconstruct the knowledge structure and beliefs of the past. Once people accept a new worldview, they will immediately lose a large part of their ability to recall and cannot recall the thoughts that changed their views before. This leads to hindsight, and it is impossible to know in advance. And, once people accept a theory and use it as a tool of thinking, they often ignore their implicit mistakes.
5
Intuition is an
Intuition is not a simple thinking, but a simplified refinement of complex thinking. Whether the intuition is accurate depends on how wide the accumulation range is in a certain aspect and how long the accumulation time is.
trains the complex thinking process to automation, and intuition is generated. Perhaps the level of consciousness has not been transmitted, and the subconscious level has begun to play a role. The more training you train in a certain aspect, the more accurate your intuition will be in this aspect. This kind of training can also be called deliberate practice. For example, when you practice martial arts to reach the level of "master", you can be better than any moves, and here it is more of an intuition. Whether your intuition is reliable or not depends on how much you practice. Therefore, in investment, continuous review, learning and thinking is an indispensable process to improve the return on investment.
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Put down Sinking cost
People can't put down Sinking cost, which often causes additional losses. If you can't let go of the cost of sinking, you will invest more in things that were not worth it, and if you want to reverse the results, you may suffer greater losses. Therefore, in investment, if the selected industry changes systematically, timely stop loss is also one of the choices.
7
Follow external opinions
Do not recognize the true face of Mount Lu, because he is in this mountain. When you stand outside, you will always be more comprehensive and clearer than people in the situation. Therefore, some major decisions require people to analyze and observe as bystanders, and they also need to solicit more opinions from others, find more similar information, and make comprehensive measures to make decisions. In this way, the decisions we make will be more rational, slow thinking will dominate, and the possibility of regret afterwards is often smaller.
But we must be clear that the future is unpredictable, so what we can do is to do well in the present, and the future is called to leave it to time.
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attention exposure effect
exposure effect - familiar things are more likely to be believed by others. For example, in investment, simple and simple investment logic is often easier to be accepted by the market, while industries with higher requirements for investor knowledge and greater cognitive barriers are often more difficult to form consensus in the market. Typically, the consumer industry is closely related to our lives, and it is also an industry where most ordinary investors are willing to invest more energy and produce large numbers of bull stocks.
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Must make good use of your thinking framework
People can control their thoughts freely. It is a result that requires long-term training to occur, and people are easily affected by the surroundings. The same meaning and different expressions will make different choices. Making good use of thinking frameworks can make our lives and investments more successful.
Finally, you might as well think about whether you rely more on quick thinking with intuition or slow thinking with rationality.
Risk warning: Fund is risky, so be cautious when investing. Fuguo Fund does not guarantee a certain profit and minimum return of the fund investment advisory portfolio strategy, nor does it make a guaranteed promise. Investors participating in the fund investment advisory portfolio strategy have the risk of not being able to obtain returns or even principal losses. The fund investment advisory business is still in the pilot stage, and there is a risk that the fund investment advisory institution cannot continue to provide services due to the cancellation of the pilot qualification.
