O'Reilly logo

Market Sense and Nonsense: How the Markets Really Work (and How They Don't) by Joel Greenblatt, Jack D. Schwager

Stay ahead with the world's most comprehensive technology and business learning platform.

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, tutorials, and more.

Start Free Trial

No credit card required

Chapter 13

Fear of Hedge Funds: It’s Only Human

A Parable

In the kingdom of Financia, the automobile was invented. After a number of years and numerous improvements, this new invention became practical and grew in popularity. More and more of the kingdom’s citizens purchased automobiles. Although the automobile improved their lives, there was a problem: As the roads grew more crowded, accidents mushroomed. Many Financians were being seriously injured and even killed because of this new invention.

An inventor in Financia made it his mission to find a solution to this problem. After a few false starts, he came up with the idea of a strap that would be attached to the car seat and wrapped around the driver (with similar straps for passengers). He called this new invention the “seat belt.” One manufacturer of luxury automobiles began installing these new seat belts in all his vehicles.

The prince of Financia, who was much loved and respected by his countrymen, purchased one of these new automobiles. He very much liked the idea of having the protection of the seat belt in case of an accident. The prince, although sensible in most respects, was a bit of a reckless driver. Now, with the feeling of security provided by the seat belt, he thought he could drive even faster.

One day, as he drove down one of Financia’s steep, winding mountain roads at breakneck speed, the prince lost control of his automobile, crashing at over 80 miles per hour. The automobile was smashed to pieces, and the ...

With Safari, you learn the way you learn best. Get unlimited access to videos, live online training, learning paths, books, interactive tutorials, and more.

Start Free Trial

No credit card required