The Most Important Thing: Uncommon Sense for the Thoughtful Investor (Columbia Business School Publishing)

by Howard Marks

ditto

It’s impossible to assess the accuracy of probability estimates other than 0 and 100 except over a very large number of trials.

“Risk means more things can happen than will happen.”

metaphysical

farsighted

“There’s a big difference between probability and outcome. Probable things fail to happen—and improbable

things happen—all the time.”

enumerating

The former is a general type of distribution, while the latter is a specific bell-shaped distribution with very definite statistical properties. Failure to distinguish between the two doubtless made an important contribution to the recent credit crisis.

But the normal distribution assumes events in the distant tails will happen extremely infrequently, while the distribution of financial developments—shaped by humans, with their tendency to go to emotion-driven extremes of behavior—should probably be seen as having “fatter” tails.

befell

a grain of salt.

带着怀疑和批判

attributable

onlookers

oddball