Leonard Mlodinow: The Drunkard's Walk and Others
Trader's Library #61 · Risk, chance and decisions. An accessible lesson on chance and emotions from a physicist.
Author: Leonard Mlodinow · Original: The Drunkard's Walk; Emotional; Elastic; Subliminal · Year: 2008 · Usefulness for traders: ★★★☆☆
What it's about
The two Polish titles of “The Drunkard's Walk: How Randomness Rules Our Lives” are most likely two editions of the same book about randomness. Mlodinow also wrote “Emotional”, “Elastic” and “Subliminal”.
What it gives a trader
“The Drunkard's Walk” is an accessible lecture on how poorly we understand chance: streaks, small samples, regression to the mean. “Emotional” explains that emotions aren't the enemy of reason but part of decision-making.
Lessons for traders
- winning and losing streaks are a natural result of randomness (the gambler's fallacy, Atlas of biases #1)
- small samples lead to big illusions
- emotions are information worth understanding, not suppressing
What to watch out for
These are popular-science books: they explain the mechanics of chance and emotion very well, but don't give ready-made trading tools.
Discussion
The discussion takes place in Hetman Capital Club (in Polish). Join the discussion in the Club →
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Educational content, not investment advice. The book description is my own summary and assessment, not quotations. Edition details were checked in catalogues and bookshops, and where there was doubt I said so plainly.