Snap Judgment: When to Trust Your Instincts, When to Ignore Them, and How to Avoid Making Big Mistakes with Your Money [Hardcover]

David E. Adler (Author)

Book Description

ISBN-10: 0137147783 | ISBN-13: 978-0137147786 | Publication Date: June 19, 2009 | Edition: 1

"Adler’s argument is illuminating and reveals that, when it comes to investing, we should always have second thoughts about our first impressions."

--Publisher's Weekly

WHY YOUR INSTINCTS CAN BE YOUR #1 ENEMY—AND HOW TO DEFEAT THEM!

 

“David Adler’s Snap Judgment is a well-written, entertaining review of human action in risky situations, including stock market behavior and other risk-facing situations. In particular, Adler recounts the conclusions of many practitioners and behavioral finance scholars who have studied such matters. This book is well worth reading, both for its practical advice for the novice and its wealth of illustrations for the pro.”

— Harry Markowitz, Nobel Laureate in Economics and father of modern portfolio theory

 

“David Adler has done a great public service by translating a dazzling array of research in economics and finance into practical terms that anyone can understand and profit from. This book should be required reading for every investor.”

— Andrew W. Lo, Professor of Finance, MIT Sloan School of Management

 

“Investing and managing your money on the basis of emotion, instincts, and intuition is a road straight to the poorhouse. This book teaches you why—and how to rid yourself of the irrational impulses that torment your portfolio.”

— Peter Navarro, bestselling author of If It’s Raining in Brazil, Buy Starbucks and The Coming China Wars

 

“Adler’s book makes a compelling case, illustrated through engaging examples, that the mind and the purse are well served by the triumph of analytic intelligence over intuition.”

— Gary Loveman, Chairman, President, & CEO, Harrah’s Entertainment, Inc.

Editorial Reviews

From Publishers Weekly

Adler (co-editor of Understanding American Economic Decline), a behavioral finance expert, explores the psychology of how we make financial decisions and argues that when it comes to investing, our intuition might lead us astray. The author surveys the mechanics of decision making in a variety of arenas—gambling, sports, health care and credit card selection—and homes in on the advanced analytical techniques used by sophisticated investors. He provides psychological profiles of Wall Street CEOs and surveys the current crisis with an optimistic bent—providing strategies for investors and businesspeople to escape their evolutionary propensity for snap judgments and become more cautious where their money is concerned. Adler's argument is illuminating and reveals that, when it comes to investing, we should always have second thoughts about our first impressions. (July)
Copyright © Reed Business Information, a division of Reed Elsevier Inc. All rights reserved.

About the Author

DAVID E. ADLER is the producer of the forthcoming PBS NOVA documentary on behavioral finance and is a contributing high-net-worth writer for Financial Planning magazine, the leading industry magazine for financial planners. He is coeditor of the anthology Understanding American Economic Decline (Cambridge University Press). Adler has written for Barron’s, Institutional Investor, Psychology Today, and The New Republic. He was recently awarded a grant by the CFA Institute Research Foundation to conduct a study of tax awareness in investment decision-making by wealth managers. Educated at Oxford University and Columbia University, he holds an M.A. in economics from Columbia.

See all Editorial Reviews

Product Details

• Hardcover: 288 pages
• Publisher: FT Press; 1 edition (June 19, 2009)
• Language: English
• ISBN-10: 0137147783
• ISBN-13: 978-0137147786
• Product Dimensions: 9 x 5.8 x 1.2 inches
• Shipping Weight: 1.1 pounds (View shipping rates and policies)
• Average Customer Review: 4.1 out of 5 stars  See all reviews (57 customer reviews)
• Amazon Best Sellers Rank: #1,001,512 in Books (See Top 100 in Books)

More About the Author

David Adler divides his time between New York's East Village and London, and between financial journalism, television, and economics research. In addition to SNAP JUDGMENT (about applied behavioral economics) he is co-editor of the anthology UNDERSTANDING AMERICAN ECONOMIC DECLINE (with the historian Michael Bernstein)which looks at America's eonomic problems in a historical context, and the institutions which have accounted for the country's comparative stagnation.

He has also produced documentaries on American popular culture, art, and economics for the BBC and PBS. His documentary "Financial Insecurity: America's Crisis in Healthcare and Retirement" was shown on PBS stations in 2005.

Currently he is researching consumer behavior when it comes to taxes, and how to help people to become more tax-efficient investors.

Customer Reviews

Most Helpful Customer Reviews

6 of 6 people found the following review helpful:

5.0 out of 5 stars Better than I thought, August 20, 2009

By 

Chris Jaronsky (NJ, the garden state) - See all my reviews
(VINE VOICE)    (TOP 1000 REVIEWER)   

This review is from: Snap Judgment: When to Trust Your Instincts, When to Ignore Them, and How to Avoid Making Big Mistakes with Your Money (Hardcover)

(What's this?)

I was drawn to this book because I love to read about financial markets and psychology. Since this combined both of them I instantly had to read it. I was not expecting too much because I have read many books on this same area and thought "how much new info could this book really have?" Surprisingly it did have a few things that made me think.

One thing I have learned over the years is that my first instinct in most areas of my life is the correct one. I have also learned that my first instinct when it comes to trading and investing, is usually the wrong one. Actually I did quite a bit better taking the exact opposite viewpoint. Why is that? David Adler explained his theory on it in this book.

The author takes a pretty complicated subject and explains it in an extremely understandable way. Usually giving multiple examples of the same topic, so even if you were a little fuzzy on one explanation, the other one should clear it up.

Basically this book helps you think through your investing strategy. It explains why some choices are good, and why some are bad. Most of the bad ones are the choices that most of us make naturally.

4 of 4 people found the following review helpful:

5.0 out of 5 stars Good Read, August 14, 2009

By 

L. Maupin "drop-dead-books" (zapperville) - See all my reviews
(VINE VOICE)    (REAL NAME)   

This review is from: Snap Judgment: When to Trust Your Instincts, When to Ignore Them, and How to Avoid Making Big Mistakes with Your Money (Hardcover)

(What's this?)

The author's purpose is to show us how our bad decision making can lead us into trouble such as gambling, and using psychology for financial decisions

Most interesting are the stories he tells and one which is really remarkable was that

most people were willing to take a sure $500 instead of a 15% chance at making a $1 million. How people come to making their judgement calls is amazing

He talks about the pitfalls like overconfidence, that can lead to leads to things like excessive risk-taking,

Overall, I liked the book.it was easy to read and examples the author uses are entertaining and easy to understand Plus one chapter does not build on the previous ones so you can pretty much open the book and begin reading

4 of 4 people found the following review helpful:

5.0 out of 5 stars I Judge Myself To Be A Better Investor Now, August 3, 2009

By 

Avram Levy (Boston, MA) - See all my reviews

This review is from: Snap Judgment: When to Trust Your Instincts, When to Ignore Them, and How to Avoid Making Big Mistakes with Your Money (Hardcover)

My intuition proved correct when I decided to buy David Adler's book. Nonetheless, I was surprised by the author's high level of sophistication and yet how clearly he writes. He's also a witty guy.
I learned not only about economics and psychology, but also about myself. For instance, after taking the short test prepared by the Yale School of Management I was surprised to learn I was almost pathologically "risk averse." (Maybe that's one reason my investments have done so poorly...) I'll certainly use that information when I interview my NEXT financial planner, and I'll use the advice Adler distills from Nobel Laureates in economics and psychology. That advice is also useful when considering whether to buy insurance, annuities, and so on.
In sum, the book gives great insights into the ways financial markets work and the way investors -- of whom I am one -- think. Next time, I actually may have a shot at building a better portfolio.
Thank you, David Adler!