Investing: Irrationality, trend-following, and cats | The Economist: " . . . . What can we learn from this? As a first approximation, you should avoid trying to time the market. Unless you are a hedge fund superstar, you are probably buying high and selling low, just like everyone else. You would be better off letting a cat manage your money. As a second approximation, you may want to try to test out an investment strategy based on discount rates. *We are not actually endorsing this strategy. Please do not blame us if it fails to work out for you.* Finally, the paper presents us with an interesting puzzle: why do discount rates do a good job of predicting asset returns despite their complete disconnect from investor expectations? One possibility raised by the authors is that companies respond to over-eager investors by issuing more shares, but this is not fleshed out. It seems like an interesting area for further research."