Investing success: Rationality scores over Intelligence

We know that tests of conventional intelligence that measure Intelligence Quotient (IQ), are only a part of a measure of how well someone thinks. Yet, most societies focus on intelligence as predictors of successful decision-making. IQ, on it’s own, has been found wanting in explaining success or failure in environments that call for complex decision-making. A paper by Michael Mauboussin and Dave Callahan of Credit Suisse “IQ versus RQ” (link to paper provided at end of post) explores the role of rationality in investment decision-making and it’s impact on success or failure. Prof. Keith Stanovich, a professor of applied psychology at the University of

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