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Borsgade
In the latest interview with Everything Money, Aswath Damodaran talks about the art of keeping investing simple, but not too simple. Damodaran argues that we as investors should only add details to our analysis of companies when they are actually needed to make an informed decision. Something that can be quite challenging in a world almost drowned in information.
Especially as [Investors] get more technically proficient, the more access they have to data, it’s easy to get drowned in the details and lose perspective. So you constantly have to step back and say, “Does it make sense for me to add that layer of detail? Does it make me a better investor, or am I just doing this because it makes me feel better?” A lot of this is psychological.
You feel like you’re in control when you have a lot of data and you do more work, but sometimes you’ve got to let that need for control go and say, “Look, this isn’t helping me as an investor. It’s making me feel more secure, more confident, but it’s really doing nothing for my investing.”
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