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How do you know if you are still unconsciously incompetent ?

Discussion in 'Investor Psychology' started by keithj, 13th Dec, 2015.

  1. keithj

    keithj Moderator Staff Member

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    This was posted recently - the 1st quote in reference to a particularly poor outcome, whilst the 2nd was referring to an earlier stage in the investment journey.

    I would guess that both felt v. similar in the earlier stages of their journey - they both felt they had education, did research and consulted with trusted and apparently expert individuals.


    So the question is.... How do you know if you are still unconsciously incompetent ?




    I would say, it's a lot more than just education....

    • It's the right education - ie a broad education from multiple unrelated sources
    • It's running simulations or scenarios - spreadsheets of both the good & bad possibilities, likely & unlikely. It have an idea of what might happen in the future.
    • It's experience - either others or your own. But be very careful of small samples - someone else's anecdote is completely irrelevant to anyone's future but their own.
    • It's critical thinking - Ask many secondary questions like.... Why does that happen? What are 2nd & 3rd level effects ? How will 'the herd' behave ?
    • It's knowing what happened last time. It won't necessarily be the same this time, but it will broaden your outlook to the possibilities
    • It's discounting (but not completely ignoring) anyone with a relevant bias - and everyone has biases of some sort
    • It's asking the right questions. However, knowing what the right questions are is hard for absolute beginners, so a poor substitute is asking any questions of many participants. You'll gravitate towards the right questions & the right people eventually
    • It's looking at the bigger picture - don't get fixated on a particular course of action without understanding how it fits in with the economy
    • It's being especially wary of anyone who exhibits Illusory Superiority - it's often the case that they are unconsciously incompetent or have their own biases or self interests
    • It's mitigating risk - run scenarios like 'if X happened then it would be OK because I will do Y & Z', and thinking of all risks, not just the obvious ones
    • It's thinking about where you feel your standing is amongst both a range of other participants (your peers, subject specialists, those N years ahead or behind you on the journey), and also yourself N months ago. Are you the patsy ?
    • It's knowing what you don't know - once you know a little, you find a few details you don't know, and upon investigation an avalanche of minutiae (think tax, legal or even depreciation schedules) - do you know just enough to be dangerous ?

    So next time you take action, first ask yourself if this is a topic where you are still incompetent.
     
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  2. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    Agreed. Nice post

    There is a mammoth black hole of 'things you don't know you need to know'. I learn things I didn't know I needed to know on a weekly basis.

    Some of it I learn on here as I will try and read threads about topics I know little about. Other stuff I gain from brain vampiring other professionals.

    Listening (and I mean truly listening) when people that are pros in their field are talking will help. Don't butt in with your own '2 cent expert opinion', listen, listen some more then ask questions to listen more again.
     
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  3. WattleIdo

    WattleIdo renovating Premium Member

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    I may sound cynical but there are some people who trust too much. Young people are vulnerable in this way. Who let them do this? Or worse, encouraged them? Old wives tales come in handy in these situations. The obvious ones involve baskets, eggs; the force of gravity on rapid increase; fools & angels.
    And the pity is that they started so young and could've taken it as slowly as they liked, with the confidence of growing equity.
    As for self-awareness, I'm thinking stones and glass houses.
     
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  4. Leo2413

    Leo2413 Well-Known Member Premium Member

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    +100.
     
  5. Xenia

    Xenia Adelaide Property Manager Business Member

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    How do you know if you are unconsciously incompetent?
    You don't - that's why it's called unconscious.

    You find out later once you become consciously competent.
    Keep growing, keep learning, keep failing, that is the only way to get there.

    You can never solve a problem with the same consciousness that created it, only when a higher awareness is gained and you can view the problem from above, a different level, can you become aware of what a twit you were in that moment - and thought you were right. lol

    Or am I the only person who experiences this?? :confused:
     
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  6. MTR

    MTR Well-Known Member Premium Member

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    Love this.

    Keep learning, keep growing:)
     
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  7. datto

    datto Well-Known Member

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    I'm incompetent by default.
     
  8. bob shovel

    bob shovel Well-Known Member

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    Is that what you were talking about @Tim86? unconscious incontinence? How'd you go?
     
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  9. Jess Peletier

    Jess Peletier Mortgage Broker - Australia Wide Business Member

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    LOL! Heaven forbid ;)
     
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  10. willair

    willair Well-Known Member Premium Member

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    Maybe it's just optimistic people who have unconscious incompetence as they take more risk,
    then become more overconfident,and most only look at what information in on the mobile updates,ignoring the information that one never looks at or did not see..
     
  11. MTR

    MTR Well-Known Member Premium Member

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    It's a catch 22, if you don't get your hands dirty how do you learn?
     
  12. MTR

    MTR Well-Known Member Premium Member

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    Keithj has started an interesting thread, don't derail please
     
  13. Westminster

    Westminster Tigress at Tiger Developments Business Member

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    I hop around with my foot in my mouth quite often when I realise that I'm wrong about something - some humility goes a long way to not looking like a righteous know it all.

    Accept the knowledge, acknowledge the knowledge and thank people who help you learn and grow, then share it if you can.

    Whilst unconscious incompetence assumes you don't know it's happening, it's not a coma. You have the choice to recognise you don't know everything and there are things you don't know. With that choice you can remember to open your ears and listen and try and learn.
     
  14. ellejay

    ellejay Well-Known Member

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    If we're talking investment it takes years and I'd argue that looking at Aus investments alone doesn't give you the big picture. So, yes, lots of scope for unconscious incompetence. However, the level of research required seriously cuts into family time and work time. You can only make the best decision for you at the time, with the information you have access to.
     
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  15. Perthguy

    Perthguy Well-Known Member

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    It's not just you. This happens to me too. A good partner can help with this. I get myself tied up in knots trying to solve some problem I have created. I explain the problem to my partner and more times than not there is a very simple solution I have overlooked. Sometimes all it takes is a different perspective.
     
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  16. Omnidragon

    Omnidragon Well-Known Member

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    Conscious incompetence is good
     
  17. jrc

    jrc Well-Known Member

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    To avoid being unconsciously incompetent you need to be willing to have people challenge or assess frankly what and how you are doing something. The most likely stage of unconscious incompetence is when you have some knowledge or experience but not enough to know when you are going to be out of your depth.

    Unconscious incompetence also probably includes consciously thinking you're better at something than you are.
     
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  18. neK

    neK Well-Known Member

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    Everyone is unconsciously incompetent..... to think that you are not unconsciously incompetent means that you are.
     
  19. Leo2413

    Leo2413 Well-Known Member Premium Member

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    I know I'm unconsciously incompetent for many things, but it doesn't worry me. I just make the best decision with the best info I have sought out from others at the time. That's all anyone can really do. Otherwise you'll just be paralyzed by inaction.
     
    Last edited: 7th Jan, 2016
  20. MTR

    MTR Well-Known Member Premium Member

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    Is this a trick question what comes first the egg or the chicken.

    At the end of the day its the outcome that matters. Keep learning.


    Marisa:)
     
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