100-Day Reading Sharing Plan — Day 65

$Cleveland Cliffs(CLF.US) $Novo Nordisk AS(NVO.US) $Amazon(AMZN.US) LOL😆

"A Random Walk Down Wall Street"

1. In statistical terms, the covariance of the two companies' returns is negative). As long as there is a lack of consistent co-movement in the profitability of individual companies within the economy, diversification can reduce risk.

2. Using a theory that is correct only half the time to guide practice is less economical than flipping a coin.

3. Roughly speaking, there are four factors that allow irrational market behavior to exist: overconfidence, judgment bias, herd mentality, and loss aversion.

4. The fancy term "arbitrage traders" is used to describe a type of person who trades to profit whenever market prices deviate from their rational value.

5. In experiments with college students, it was found that 80% to 90% of subjects always claimed to be better and safer drivers than their classmates.