2 docs tagged with "howard-marks"

Second Order Thinking is a decision-making framework that requires you to consider not just the immediate consequences of an action (first order), but the subsequent consequences of those consequences (second order), and potentially further iterations. Developed and popularized by investor and author Howard Marks, it is the discipline of asking "and then what?" until the full consequence chain becomes visible — and is most valuable when immediate effects seem clearly positive but downstream effects are ambiguous or harmful.

The complete mental model system for investment decision-making — Expected Value, Circle of Competence, Margin of Safety, and the 9 cognitive traps that systematically destroy investor returns. Based on the documented frameworks of the world's most successful long-term investors.