Poker Champ Highlights Common Investment Mistakes

Poker champion Annie Duke, who won top honors at the World Series of Poker and was once in Columbia cardsUniversity’s PhD program for cognitive psychology, spoke to the Investment Management Consultants Association recently.  “Poker is a game of decision making under conditions of uncertainty over time,” she said.  She highlighted some common investor mistakes, such as staying with a course of action based on committed resources despite evidence that odds of future success are low.  Duke also said people tend to underinvest for the future.  “We actually don’t know our future selves,” so people tend to over-emphasize their current situation to the detriment of their future needs.  She also encouraged a more realistic perspective on investors and advisors role in success and failure: “If you credit all wins to your skill and all losses to bad luck, you never learn and never improve.”