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by woah 703 days ago
> Once you have identified an activity as being more luck than skill driven, a person’s process for the activity starts to become a much stronger signal for whether or not they are actually any good.

This is the central point of the article, and I don't think it's true. If it were as easy as "following a good process", then anyone could get rich investing.
2 comments
jjxw 703 days ago
This is a point worth clarifying. I think a lot of people actually do get rich investing. It just turns out the "good process" in this case is leaving your money in a diversified portfolio for decades. This leverages making a bunch of bets that on average have a positive expected value over a long enough time horizon that you are able to realize the gains.

There are also certainly other ways to have an edge in investing (quant firms come to mind), but I think the most realistic option for "anyone" is readily available in the form of low fee index funds and a long time horizon.

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afc 703 days ago
> I think a lot of people actually do get rich investing.

https://youtu.be/H5jPJQ5cVGU?si=KoXd4H3FOkLZ1y06 has an interesting counter-point. You need to fuel your returns with savings.

I guess it's a subtlety — in the end, since you said "for decades", and if you adjusted your wording sightly (such as "help you reach your financial goals", instead of "get rich"), the underlying message is similar. But I figured I'd share the link in case you find it interesting.

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jjxw 703 days ago
Yeah, agreed, love the Plain Bagel and the generally sane takes from that channel.

"Get rich" is definitely too broad of a target and probably has too many connotations with "mansion and luxury cars" when, as you identified, what I meant with that statement is closer to "financial goals" or, more tangibly, something like "comfortable retirement".

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yuliyp 703 days ago
The article demonstrated that skill / correct process is not sufficient for success. However, for making estimates of future results, looking at the process to gain insights into the EV rather than looking at past results can be more fruitful. Just looking at past results often results in falling victim to reversion to the mean.
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