Definitions
Inversion can be
defined as ”Something that is the opposite of what it was before”
or as ”A reversal of position, order, form, or relationship”.
Inversion is a powerful
problem-solving tool
When you are
confronting a problem, you can many times get an easier answer by
inverting the problem. For example, calculating probabilities of
certain events are easier by calculating them not happening. Many
times you save time too. There are also many other math problems that
are easier to solve with inversion.
There are many
other problems to take inversion into advantage. One of the best ways
to use it is to ask yourself: "what we shouldn´t do?" Many strategies
focus on what to do and forget maybe even more important aspect of
what not to do. Successful people should ask themselves ”What
shouldn´t I do to stay successful?” instead of asking ”What I
should do to stay successful?” They should also ask ”What I
shouldn´t do the same way as before?” instead of asking ”What I
should do the same way as before?” in order to become more
successful. It is also easier to think about what not to do than what
to do. Failures leave more clues. Success can be a consequence of
some small change in your daily habits. Basically, you learn more by
thinking about what went wrong, instead of thinking what you did
right. It is even better to learn from other people´s mistakes.
Successful
investing is more about avoiding catastrophical losses than getting
this right. Avoiding all the insanities of other investors help you to
get better investment returns. When you lose less, you have a
possibility to gain more capital. Some of the craziest things
investors do can destroy an investing career. Avoiding them is a
requirement for investing success. You can also use inversion in
investing, by trying to find as much disconfirming evidence as
possible about your best investing ideas. By doing this, you will
probably not invest too much money to them. And you can even gain an
insight that the idea is as good as you think it is.
You should also ask
ourself, ”What I don´t know?” You get more into trouble about
the things you don´t know than things you know. You should not focus on
the things you don´t understand or you don´t have enough information
about. One thing you usually forget is that you cannot predict the
future. It is always the thing you don´t really know. You can make
predictions, but you should understand that your success is always
uncertain. Instead of predicting, you should think about the
probabilities and accept the uncertainty.
Thinking about the worse case
scenario instead of success
You should also
think about what are the consequences of failing. If you are
considering some big changes in your life, you should also think about
the worst case scenarios for them. For example, trying to do
something else than you have done before may not have many bad
consequences. This is especially true, when your ordinary life is not
very satisfactory. By figuring out what are the worst things that
could happen, you may free yourself from the agony of not taking an
action. You can see that failing is not a very bad option, compared to
not doing anything.
For example,
learning a latticework of mental models with information from most of
the biggest scientific disciplines by studying the works of the all
time greatest practitioners don´have many bad consequences. It may
cost you some money and time. There are always some opportunity costs. You get better understanding of the world and people by developing our
latticework of mental models. The worst thing that can happen is
learning the wrong things. And this is added to the loss of money and
time. When you focus on finding the best sources for learning the
mental models, the risk of learning from wrong sources is low. In my opinion, the
opportunity costs of learning the new things from other disciplines
than our field of expertise are low.
Sources:
-TT
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