The Noise Bottleneck: When More Information is Harmful

Discussion in 'Investor Psychology & Mindset' started by paulF, 1st Nov, 2018.

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  1. paulF

    paulF Well-Known Member

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    paulF, 1st Nov, 2018
    #1
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  2. Perthguy

    Perthguy Well-Known Member

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    It depends on whether you see a correction as a "bad" thing or an opportunity. I have bought 2 investment properties in Perth since the market "crashed". I have also built a new IP in Perth during that time. Where others see a dead market, I see opportunities. I don't think information is harmful. It depends on what you do with it that determines its usefulness.
     
    Perthguy, 1st Nov, 2018
    #2
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  3. MTR

    MTR Well-Known Member

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    What's new... .when markets are booming there is lots of noise, speculation.... what will go up, how much will it rise, how long will it last...….
    Just have to read threads on PC on this, many predictions fizzled.

    Now we see the downturn.... same noise, how far will it drop, where, how long will it last etc etc. Hence all the threads we are now reading on ie APRA, crashes etc etc

    You cant ignore the noise, its just a matter of what you do with the information and whether you planned for the good times and the bad times... winners and losers

    How it impacts on investors will be dependent on how they managed the risks
     
    Last edited: 1st Nov, 2018
    MTR, 1st Nov, 2018
    #3
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  4. paulF

    paulF Well-Known Member

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    Great feedback but misses the point of the article.
    The articles point to know who to listen to because :
    "The more frequently you look at data, the more noise you are disproportionally likely to get (rather than the valuable part called the signal); hence the higher the noise to signal ratio"

    And hence the conclusion that it's best to limit your sources in the first place.
     
    paulF, 2nd Nov, 2018
    #4
  5. robboat

    robboat Well-Known Member

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    Noise - ha....
    Have a friend who suffers "analysis paralysis" from all the charts, graphs, assessments and opinions he consumes....and still often misses opportunities.

    As a mentor once told me - Too much frogsh*t.....you gotta look out for the frogsh*t.....:):);)

    If you can't understand it...find something you can.
    KISS principle works.....:p
     
    robboat, 2nd Nov, 2018
    #5
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  6. Perthguy

    Perthguy Well-Known Member

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    I don't agree. That view represents low order thinking to me.
     
    Perthguy, 2nd Nov, 2018
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  7. Eric Wu

    Eric Wu Well-Known Member

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    so true, use the "noise" to own advantage.
     
    Eric Wu, 2nd Nov, 2018
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  8. jazzsidana

    jazzsidana Well-Known Member

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    man-is-just-chaos-walking.jpg
     
    jazzsidana, 3rd Nov, 2018
    #8
  9. geoffw

    geoffw Moderator Staff Member

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    geoffw, 3rd Nov, 2018
    #9