The trader who changed his mind

Nassim Taleb has a lot of respect for George Soros.

Soros is a legendary trader and hedge-fund manager with a net-worth of over $8 billion.

But Taleb has very little interest in the fortune Soros has amassed during his investment career.

Rather, he admires Soros’ ability to cope with randomness.

In a profession marked by its unpredictability, George Soros found success where others failed by remaining acutely aware of his own fallibility. He always kept a critical open mind and changed his opinions readily without shame.

In his book Fooled by Randomness, Taleb illustrates with the following anecdote:

The French playboy trader Jean-Manuel Rozan discusses the following episode in his autobiography (disguised as a novel in order to avoid legal bills). The protagonist (Rozan) used to play tennis in the Hamptons on Long Island with Georgi Saulos, an “older man with a funny accent,” and sometimes engage in discussions about the market, not initially knowing how important and influential Saulos truly was. One weekend, Saulos exhibited in his discussion a large amount of bearishness, with a complicated series of arguments that the narrator could not follow. He was obviously short the market. A few days later, the market rallied violently, making record highs. The protagonist worried about Saulos, and asked him at their subsequent tennis encounter if he was hurt. “We made a killing,” Saulos said. “I changed my mind. We covered and went very long.”

George Solos was never married to his ideas. He held his opinions loosely and was quick to self-contradict himself when presented with better information.

It’s the trait that would go on to make him a legend among his peers.

Unfortunately, today’s culture doesn’t seem to value self-contradiction quite the same as George Soros did.

If you change your mind, you’re pressured to feel ashamed. Instead of admitting you were wrong, we’re taught to double-down and shift the blame.

This attitude is self-defeating. I see it in the mainstream media, in Twitter comments, and it even pervades some of my daily conversations with family and friends.

Quite frankly, I find it discouraging.

It doesn’t encourage learning and leaves no room for growth.

Progress isn’t possible in a close-minded society. We need to give people room to change their mind. We should encourage people to consider alternatives and open the door to spirited debate.

Not pigeon hole and label people according to what they believed at one point in time.

George Soros knew better than anyone. The best traders can’t be afraid to change their mind.

And neither should we.