In this case, that point is called randomness. You must understand the role of randomness in both trading and everyday life to avoid becoming a victim of your own superstitious foolishness.Consider the fortunes of two fictional traders, Nero and John:The moral of this story is that sometimes the more cautious style pays off, since it compensates for the potential of the rare, destructive, random event in daily life. Randomness, chance, and luck influence our lives and our work more than we realize. !Can you please tell me 10 places where i should be irrational because i didnt understand that point, lile why to be irrational.Taleb is an author of some of the best books, can say he has written several masterpieces such as Antifragile, the black swan, the bed of Procrustes including today’s book summary Fooled by randomness.So let’s discuss with Fooled by Randomness Summary:Life isn’t fair, which makes the rewards of continued efforts excessively big:Here author says that many systems we move and live works in linear fashion mean in sequential form, usually in one line, with every day of your work you move closer to your promotion, when you go to school you move closer to graduation, with every savings you do, you move closer to your retirement same lifestyle, and so on.Because of all these events we think that life is linear means sequential but that’s not the actual fact, for example you all must have heard about Darwin’s theory about survival of fittest, here survival of fittest only means that best-adapted organisms will have higher chances to survive an average but this doesn’t mean that unfit organisms can’t survive at least in the short run, means it doesn’t stop unfit to survive for short run.Author says the reason life is not linear or can say the reason life is non-linear because life is path dependent means we can’t be sure that we will end with the same result the way we have started, example, earlier only one office used to use windows desktop, but suddenly half of all offices started using windows and non-windows users become the minority, hence earlier windows users were the minority but later windows non-users became the minority, hence it’s not sure that the way things started will end up the same way, because life is path dependent, as we can see that one grain of sand can bring down an entire sand castle, one extra day at work or one extra phone call can bring or can give huge rewards,Hence author wants to say that we people can get disproportionate size of rewards from an ongoing process, it’s not necessary that big things will give big rewards even small thing can give big rewards, but however people fail to see the progress which they can get from the extra miles hence they give up, people fail to see the progress they can get through more hard work and efforts hence they give up before seeing that progress.Without our irrational emotions we often couldn’t make decisions at all, we need them:We need irrationality to make certain decisions, author says that if we make every single of our decisions based on rational reasoning then we may not able to survive or we will cease to exist, author says that not every decisions or choice can be easy, some choice can be indifferent, like there can be some choices which outcome will neither makes us feel better and will not able to make us feel worse, for example just as hypothetical situation, if you want to invest money, by thinking rational like market can go down or can go up, by thinking this way you won’t be able to make proper decision, unless yo being slightly irrational, like if you think only one way yes market will go down only then you will be able to make firm decision.Hence author here want us to understand that sometimes some decisions choices needs irrationality, always by being rational we can’t be able to make proper choices. Books we rate below 5 won’t be summarized. Title: Fooled by Randomness: The Hidden Role of Chance in Life and in the Markets Author: Nassim Nicholas Taleb Subject: Psychology Keywords # Paperback: 368 pages # Publisher: Random House Trade Paperbacks; 2 Updated edition (August 23, 2005) # Language: English # ISBN-10: 0812975219 # ISBN-13: 978-0812975215
Access a free summary of Fooled by Randomness, by Nassim Nicholas Taleb and 20,000 other business, leadership and nonfiction books on getAbstract. Power dynamics, life strategies, and owning your life.About The Author: Nassim Nicholas Taleb is a former trader, philosopher, statician and risk analyst.Nassim Taleb says he spent his life in a fierce fight between his brain -not fooled by randomness- and his emotions -completely fooled by randomness-.Part of I of Fooled by Randomness discusses the role that that luck plays in life.Nassim Taleb says that it’s silly to judge people’s skills and talent purely on the basis of their success or wealth.Because there’s a good chance it’s just chance -or risky behavior that’s not likely to last in the long term-.Taleb lays out the example of “master of the universe” successful traders who made millions only to later lose many more millions in the subsequent market crash.Those master of the universe traders didn’t make money because they were good, they were just piling up on risk and riding the wave.Nassim Taleb uses Nero Tulip, a friend of his, an example of a more rational investor (Nero Tulip always invested safely and ended his career early and wealthy.