Book Review: The Money Game

The Money Game (1968) by 'Adam Smith'

George Goodman, writing under the pseudonym of Adam Smith, discusses the psychology of the stock market and the people involved in it. Back in the 1960s, not much consideration had been given to what is now called behavioral finance, so this book is often regarded as groundbreaking in that respect. Through a combination of anecdotes and general observations, the author provides many interesting and witty insights into investor psychology, driving home the point that many investors -- including professional money managers -- are anxious, biased, and irrational. To some extent, they are all playing a game, with the flow of money determining who is winning and losing the game. Even though the book was written over 40 years ago, it is remarkable how little some things change.

Note: I read this book in May 2012.