The importance of Mental Models for an Investor

The importance of Mental Models for an Investor

A friend sent me this link (Farnam Street) yesterday on Mental Models and how to think. Loved it! You should check it out.

As investors we need to learn "how to think" and that requires mental models. Not only that, you need to be able to see issues from different angles. That is why it is important for investors to read widely and get an understanding of how different spheres work. Otherwise, we tend to just stick to our own preferences and what we are comfortable with. 

It's great to keep saying Think outside the box. But if you've not practiced it regularly, it won't come easy. 

It might feel slightly uncomfortable or boring to read about other fields that on the surface may not have anything to do with what you want to look at, but that's how we grow! Not just as investors, but as people. 

Keep reading, keep thinking, keep growing.

Joshua Fong, CFA

Article by Joshua Fong, CFA

Published 24 Sep 2022