Title: Avoid These 10 Mistakes (#QualityTuesday) Show: Compounding Quality (compoundingquality.net — Pieter Slegers' quality-investing newsletter) Guest: Pieter Slegers (author) Date: 2026-FEB-03 URL: https://www.compoundingquality.net/p/avoid-these-10-mistakes Length: written post (paid) — no timestamps Note: Paid-subscriber post captured via Stephen's logged-in session. Body text verbatim; page chrome removed. The ten biases are published only as an infographic and are transcribed below as a [Table image — ...] block.
It's #QualityTuesday!
In this series, I'll teach you 5 things about the stock market in less than 5 minutes.
1. 10 Biases to avoid
Most of the smartest people still make dumb decisions when it comes to investing.
You can be very successful by making fewer mistakes than others.
How? Just listen to Charlie Munger:
"It is remarkable how much long-term advantage people like us have gotten by trying to be consistently not stupid, instead of trying to be very intelligent."
The image below shows 10 biases that cause frequent investing mistakes.
[Table image — "Charlie Munger's Guide to Investing Biases: Don't Be a Fool!" Header line: "If reality hurts, don't lie to yourself. You'll just lose money faster." 1. DENIAL — Ignoring bad news leads to terrible decisions and slow reactions. 2. CONSISTENCY BIAS — Defending a wrong position just to avoid looking foolish. 3. SOCIAL PROOF — Copying the crowd in uncertain situations, often blindly. 4. INCENTIVE BIAS — People respond strongly to rewards — sometimes against your interests. 5. AUTHORITY BIAS — Unquestioningly following the advice of authority figures. 6. LIKING BIAS — Believing people we find agreeable, regardless of facts. 7. DEPRIVAL SUPER REACTION — Losing hurts more — don't overreact to small losses. 8. GAMBLING & REWARDS — Random rewards are addictive. This is investing, not a casino. 9. RECIPROCATION — Feeling compelled to return favors, often exploited by marketers. 10. "MAN WITH A HAMMER" SYNDROME — If you only have one tool, every problem looks like a nail. Footer: "COMPOUNDING QUALITY — By overcoming these biases, you make better decisions, avoid costly mistakes, and improve long-term compounding results."]
2. The Psychology of Money
The Psychology of Money by Morgan Housel is the best Personal Finance book ever.
It teaches three core lessons: - Envy is the fastest way to destroy good decisions - Don't confuse "luck" with "skill" - Short-term emotions can create long-term mistakes
I created a full book summary. You can read it here: Summary: Psychology of Money
3. One simple investment quote
You don't have to figure out everything on your own.
Sometimes, the smartest move is to ask an expert.
Here's some wisdom from Charlie Munger:
[Image — Charlie Munger quote card, not reproduced]
4. The Psychology of Human Misjudgment
Charlie Munger spent decades studying why smart people make bad decisions.
He spoke about 24 biases in his famous speech The Psychology of Human Misjudgment.
You can get the full transcript here. It's a must read for every serious investor: The Psychology of Human Misjudgment
5. Stock Pitch: Adobe ($ADBE)
How does the company make money? Adobe makes money by selling software tools for creativity and productivity, like Photoshop, Premiere Pro, Illustrator, and Acrobat. Almost 94% of its revenue is generated via subscriptions.
Adobe is a quality business that benefits from stable revenue and predictable cashflows.
With AI integrated software Adobe is expected to grow by 14.3% per year in the long-term.
Interestingly, Adobe is trading at a Forward PE of 13.6x. Its cheapest valuation level ever.
Investors are afraid AI will disrupt their business model.
If it doesn't, it could be a great buy at current prices.
Especially because Adobe is buying back a lot of its own shares.
You want to learn more? Read our Not So Deep Dive here: Not so Deep Dive: Adobe
[Image — Adobe forward PE history. Source: Fiscal.ai]
Everything in life compounds Pieter (Compounding Quality)
Book Order your copy of The Art of Quality Investing here
Used sources Interactive Brokers: Portfolio data and executing all transactions Fiscal.ai: Financial data
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