Nobody likes to be called a dummy by a dummy.

Higher IQ Means Better Investing

http://www.sciencedaily.com/releases/2007/07/070704144512.htm
- Intelligent People Are More Patient In Financial Matters; Higher IQ Also Makes More Tolerant Of Risk

<quote>
Instead, intelligence, patience and risk tolerance seem to be closely interconnected -- and probably for a good reason. In order to be able to assess a risk correctly or to have a successful strategy in the long term, it is necessary to be able to recognise how things are interconnected. "Anyone who does not have this ability may be better advised to follow the principle of 'A bird in the hand is worth two in the bush,'" Professor Falk says.

However, someone who is intelligent seems to be twice favoured, according to the results of the Bonn study. On the one hand, they can be more successful, due to their cognitive abilities, than their less intelligent contemporaries. On the other hand, they are generally more tolerant of risk and more patient -- two character traits which research shows contribute additionally to success at the workplace.
</quote>

There's a dark side to this too. People with a higher IQ, by the same logic, have a higher risk of losing it all and may be in a position to cause you a loss. Sometimes a bird in the hand is the right strategy.
Permalink son of parnas 
July 5th, 2007 11:19am
Women are better investors than men. What's the inference to take away from this?
Permalink LeftWingPharisee 
July 5th, 2007 1:17pm
I would think that higher IQ means you've got a more arrogant investor.

"I'm right about everything else, so I'm right about picking ENE to invest my life's savings, too"

Investing needs to be done dispassionately and humbly.


* ENE was Enron's ticker symbol
Permalink xampl 
July 5th, 2007 2:40pm
One needs to have a certain level of IQ to know that money doesn't grow on trees.

If your investment isn't producing value for its customers (ie, doing something they couldn't do before or doing something they could, but cheaper), then you're banking on getting out before your straw house comes tumbling down.
Permalink Send private email strawdog soubriquet 
July 5th, 2007 2:46pm
>I would think that higher IQ means you've got a more
>arrogant investor.

Higher IQ has quite a weak correlation with arrogance, IME.
Permalink Send private email Colm 
July 6th, 2007 8:06am

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