Ethics
- Duties of fiduciary
- Loyalty (no self-dealing)
- Care (reasonable study, judgment)
- Candor/disclosure (have to tell what you know, can't hold back for yourself)
- Foreign Corrupt Practices Act
- Bribes vs. grease payments
- Must be authorized and booked properly
- Professional codes of ethics: CYA codes (not about morality)
- Business experience, societal norms, values
- Trust, integrity, fairness, caring/compassion
- Normative ethics (I'm ok, you're ok, based on society at time)
- Kantien ethics (rigid, rules-based for what required for being considered human race; never can lie)
- Utilitarianism (greatest good for greatest number; leaves some people out)
- Social justice
- Religion
- Insurance value of average American dying in airplane (based on average age, earnings power): $1.2 million
- Insurance value of average Portuguese fisherman dying in airplane (based on average age, earnings power): $60K
- Is one worth more than other?
- 4 ways of reading Dante
- Surface level: plot
- Allegorical: myths and heroes
- Moral: custom and law
- Deep: spiritual, ethical
- Trading biases or How not to lose money in financial markets
- People tend to sell their winners too quickly and hold on to losers too long.
- Experts overconfident too; attribute success to effort not luck
- People take too much credit for their own success.
- Don't confuse brains with a bull market.
- Overconfidence leads to excessive trading.
- Trading is hazardous to your wealth.
- High portfolio turnover => low return
- Transaction fees kill.
- Women have less turnover in portfolios and do better than men.
- Marital status doesn't matter.
- Marriage helps make men better traders, but hurts women.
- Psychology: men need marriage, but not very good for women
- Single man has nothing to do (an idle man is the devil's workshop)
- Study of online trading
- People performed well before going online
- Accelerate trading after going online
- Trade more speculatively after going online
- Perform poorly after going online
- Self-attribution bias: take too much credit for successes, little blame for failures
- Illusion of knowledge (knowing vs. knowing the relevant, useful issues)
- Illusion of control (people prefer to roll their own dice)
- Individuals prefer stocks w/ high skewness and volatility (institutions prefer opposite)
- People with more speeding tickets and greater overconfidence in personality profile trade more.
- Oaktree: Real estate and CMBS deals
- Focus more on risk than reward in this type of asset management
- Don't lose others' money
- When market up, want average results
- When market down, want to beat others by not going down as much
- Responsibility to others, relationship
- Some properties can fetch ego buyers.
- Don't always destroy competitors; help them and be "go to" option that others turn to in time of need.
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