Work harder, thinking smarter

A reader asks Geoff Gannon how, apart from reading and analysing, he can become a better investor. Geoff tells him to develop style
Sometimes it's hard to make the jump from learning to investing, but to an investor you've got to put in the hard work and make the tough decisions. Reading won't differentiate you from the crowd, your decisions do that, and in time you will develop what Gannon calls style and Warren Buffett calls his 'circle of competence'. These things can help:

1. Writing a journal
2. Maintaining a bucket list of your top five companies irrespective of price
3. Working hard

Successful investing takes dedication, if Ted Weschler's example is anything to go by
The unassuming investment manager now working for Warren Buffet ran every day for 25 years, before taking a day off to show he didn't have to. Friends say it typifies his working pattern. 'Ted will spend months quietly in the corner trying to understand a particular issue, then he emerges like a quiet reporter of what he’s learned.'

There are two ways to make a poor judgement; allow instinct to override reason, or apply the wrong kind of reason
How's your mindware? Your powers of deductive logic, or probability theory, say, that enable you to override instinct and think about problems rationally? At every stage of a reasoning task, if we find it too difficult, our brains will revert to instinct. And even when we come to a seemingly rational conclusion, our mindware may have been contaminated by bias. To overcome our innate ability to get things wrong we need a rationality toolkit; to remember to think about alternatives, recognise our biases, break problems down, and that's only the start…

Extracts from Ray Dalio's book of principles reveal how the founder of the world's biggest hedge fund thinks
Make mistakes, suspend your ego, it's OK to fail as long as you learn from it. Take responsibility, don't spread it around a group. Fight every battle, however small, because small things can be symptomatic of big problems. Keep asking why? Why? Why? Until you get to the bottom of the problem. Distinguish the important from the trivial. Do the important things well and you won't have time for the trivial. Nothing is 100% true, so don't let people challenge your assertions by dwelling on exceptions.