{"id":625,"date":"2022-01-14T10:14:28","date_gmt":"2022-01-14T10:14:28","guid":{"rendered":"https:\/\/mailinvest.blog\/index.php\/2022\/01\/14\/portfolio-thinking-seths-blog\/"},"modified":"2022-01-14T10:14:28","modified_gmt":"2022-01-14T10:14:28","slug":"portfolio-thinking-seths-blog","status":"publish","type":"post","link":"https:\/\/mailinvest.blog\/index.php\/2022\/01\/14\/portfolio-thinking-seths-blog\/","title":{"rendered":"Portfolio thinking | Seth’s Blog"},"content":{"rendered":"

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When we\u2019re not certain of the right answer, the best approach is to have a portfolio, a range of bets that reward us with resilience and significant upside.<\/p>\n

An example can be something as simple as what to put on the buffet\u2013if you\u2019re not sure who\u2019s coming to the meeting, it makes sense to have a variety of options, because the chances you\u2019ll get it right go way up.<\/p>\n

A more important example is in filling a job. If you only interview people from similar backgrounds and with similar skills, you\u2019re eliminating a huge pool of talent that might in fact be a much better fit for the job.<\/p>\n

The mistake we often make is in building a choice set (which we mistakenly call a \u2018portfolio\u2019) by trying again and again for one guaranteed ideal choice. That\u2019s not a portfolio. Instead, we should focus on going to the edges, not trying to group everything at some imaginary \u2018center\u2019.<\/p>\n

Back to the simple buffet example. If you have one spicy dish, one vegan dish, one dish without cilantro and one dish from a cuisine that\u2019s out of the ordinary in this setting, your chances of \u201cbest lunch ever\u201d are far higher than if you simply put out very slight variations of one theme.<\/p>\n

When we can\u2019t be sure of the future, a portfolio that acknowledges this by going to various edges will outperform one where we pretend we know the right answer.<\/p>\n<\/div>\n