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Why do smart, capable individuals and teams so often make poor decisions? Running Against the Herd offers new answers to this question by blending insights from behavioral economics with hard-earned lessons from a twenty-five-year investing career.
Eddie Perkin draws on his extensive experience leading global investment teams to identify biases that shape our decisions, not just in markets and boardrooms but also in sports, gambling, and everyday life. He shows how groupthink and mental shortcuts—from anchoring and framing to short-termism—impair judgment and shares practical tools to counteract them. Through real-world examples and data from hundred-million-dollar investment decisions, Perkin demonstrates that success depends less on predicting the future than on designing teams and processes that challenge assumptions, welcome dissent, embrace uncertainty, and learn from mistakes.
Accessibly written and deeply relevant beyond finance, this book reveals how anyone—investors, leaders, or professionals across fields—can improve their decision-making by understanding its underlying psychology. Running Against the Herd provides a road map for thinking more clearly, working more collaboratively, and achieving better outcomes in a world of uncertainty.
— Tom Faust, former chairman and CEO, Eaton Vance
Drawing on his extensive investment experience, Perkin offers practical tools to challenge assumptions, embrace uncertainty, and learn from mistakes. Essential reading for investors, leaders, and professionals alike.
— Rupal J. Bhansali, author of Non-Consensus Investing: Being Right When Everyone Else Is Wrong
Running Against the Herd is a smart, timely, and highly practical guide to becoming a better investor and a better decision-maker. Eddie Perkin shows how the biases that trip up analysts and portfolio managers can be recognized, challenged, and turned into opportunities for better judgment, stronger sell discipline, and improved results. Just as importantly, he tackles a subject too often overlooked in investment literature: how to build, structure, and lead a successful investment team. This is an insightful and engaging book that deserves a wide readership among both emerging analysts and seasoned portfolio managers.
— Katrina Dudley, author of The Moderator’s Handbook: A Comprehensive Guide for Facilitating Panels
In Running Against the Herd, Eddie Perkin does a wonderful job applying the insights of his years of frontline asset management experience to the major biases that bedevil not only individual investors, but more critically, professional teams. A unique and practical work that retains the rare virtue of being very fun to read.
— Frank Murtha, founder of the Financial Counseling Institute and coauthor of MarketPsych: How to Manage Fear and Build Your Investor Identity
Introduction
Part I. Fifteen Biases and Their Solutions
1. The Endowment Effect
2. Sunk-Cost Fallacy
3. Hindsight Bias
4. Outcome Bias
5. Survivorship Bias
6. The Framing Effect
7. Mental Accounting
8. Anchoring
9. Recency Bias
10. Short-Termism
11. Confirmation Bias
12. Analysis Paralysis
13. Action Bias
14. Optimism Bias
15. Overconfidence
Interlude. From Bias to Collaboration
Part II. Leading a Collaborative Team
16. Grappling with Groupthink
17. Team Versus Individual
18. Ideal Team Size
19. Building the Team
20. Team Culture
21. Mental Models
22. Incentives
23. Sell Discipline
Final Reflections
Reference Guide: Summary of Solutions
Acknowledgments
Notes
Bibliography
Index