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Bridge over ocean
1 November 2005 Financial Analysts Journal Volume 61, Issue 6

Biases and Lessons

  1. Henry Kaufman

Today's financial community is suffering from a failure to learn the lessons of the past and from biases that cannot be overcome by all our quantitative techniques. Primary lessons involve the limitations in our modeling and forecasting, the occasional irrationality of the market, and the need to focus on our fiduciary responsibilities. Biases can blind us to the remembrance that the future does not repeat the past and to the inevitability of hard times.

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