Nassim Taleb sat down with Daniel Kahneman - two of the sharpest minds on risk ever - and the takeaway was blunt: stop trying to be smart
Kahneman's prospect theory explains why almost nobody can do what Taleb does
We're wired to hate the steady trickle of small losses his strategy needs - even when one huge win more than pays for all of them
So you structure it the other way: tiny safe bets plus a few wild ones, never the comfortable middle.
"You'd rather be antifragile than intelligent - any time."
"Trial and error is really just trial with small error."
"Make your gains in small bites. Take your losses all at once."
~1 hr, free. two legends on risk, prediction, and how to win without forecasting ↓
Nassim Taleb helps run one of the most famous crash funds on earth. His edge: having no idea what's coming
He and Spitznagel buy far out-of-the-money options non-stop, regardless of the news. They never forecast the crash - they just stay positioned so one shock pays for years of small losses
~10% a year in normal times. ~3,700% in a single crisis month
"We have absolutely no notion of the future. We just buy the options."
"If you have a reason in mind to buy an option, don't - it'll already be priced in."
"Up the escalator, down the elevator."
~25 min, free. how the world's most famous crash-trader actually makes money ↓