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| [Image © Alexey Brin / Adobe Stock. Modified for The Ignorant Investor: theignorantinvestor.com] |
Ignorant is a word that traditionally has a very negative connotation. Ignorant can mean unsophisticated or uneducated on its tamer side or slide further down the scale to discourteous or rude.
The Ignorant Investor is none of these things. Unsophisticated relative to the ever evolving world of quant funds and algorithmic trading, yes. But Ignorant more in the form of Rational Ignorance.
"Rational ignorance is refraining from acquiring knowledge when the cost of educating oneself on an issue exceeds the potential benefit that the knowledge would provide" - Wikipedia (and economics textbooks)
The Ignorant Investor primarily busies himself with
- Attention to specific subsectors of the energy markets
- Various exchange traded products
- Broader market-influencing (S&P 500) news and events
Topics outside of these areas are interesting and may at times be helpful, but as anyone even tangentially involved with finance will tell you, the investment world is a very large place. Beyond a dizzying and expanding array of investment vehicles are investment theories and methodologies galore. It is therefore helpful to stay focused in a smaller area and grow deeper in both understanding and expertise. Even more helpful is if this area of expertise proves difficult for automated trading strategies to efficiently exploit.
So there you have it. My postulate is that to achieve success, the average investor - or, indeed, even the professional investor - must practice some degree of rational ignorance. In other words, this investor would also be The Ignorant Investor.
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DISCLAIMER
This blog is not a place to come to for financial advice. The author mainly uses this non-commercial site to share news that the author considers newsworthy with the purpose of fostering a better understanding of the equity market. Solid independent research AND the consultation of an investment professional are prerequisites for a successful investment future.
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CONTACT
The Ignorant Investor can be reached at the email address below:
contact@theignorantinvestor.com
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