Fooled by Randomness

by Nassim Nicholas Taleb

Fooled by Randomness is a standalone book in Nassim Nicholas Taleb’s landmark Incerto series, an investigation of opacity, luck, uncertainty, probability, human error, risk, and decision-making in a world we don’t understand. The other books in the series are The Black Swan, Antifragile, Skin in the Game, and The Bed of Procrustes.

Fooled by Randomness is the word-of-mouth sensation that will change the way you think about business and the world. Nassim Nicholas Taleb–veteran trader, renowned risk expert, polymathic scholar, erudite raconteur, and New York Times bestselling author of The Black Swan–has written a modern classic that turns on its head what we believe about luck and skill.

This book is about luck–or more precisely, about how we perceive and deal with luck in life and business. Set against the backdrop of the most conspicuous forum in which luck is mistaken for skill–the world of trading–Fooled by Randomness provides captivating insight into one of the least understood factors in all our lives. Writing in an entertaining narrative style, the author tackles major intellectual issues related to the underestimation of the influence of happenstance on our lives.

The book is populated with an array of characters, some of whom have grasped, in their own way, the significance of chance: the baseball legend Yogi Berra; the philosopher of knowledge Karl Popper; the ancient world’s wisest man, Solon; the modern financier George Soros; and the Greek voyager Odysseus. We also meet the fictional Nero, who seems to understand the role of randomness in his professional life but falls victim to his own superstitious foolishness.

However, the most recognizable character of all remains unnamed–the lucky fool who happens to be in the right place at the right time–he embodies the “survival of the least fit.” Such individuals attract devoted followers who believe in their guru’s insights and methods. But no one can replicate what is obtained by chance.

Are we capable of distinguishing the fortunate charlatan from the genuine visionary? Must we always try to uncover nonexistent messages in random events? It may be impossible to guard ourselves against the vagaries of the goddess Fortuna, but after reading Fooled by Randomness we can be a little better prepared.

Named by Fortune One of the Smartest Books of All Time

A Financial Times Best Business Book of the Year

Our thoughts on Fooled by Randomness

Typically, when we witness someone being extraordinarily successful, we ascribe their achievement to talent. But talent will usually only lead to modest success. Wild success—the kind that brings with it excessive wealth and enduring fame—is frequently the result of luck, specifically a favorable rare occurrence coupled with a paucity of unfortunate rare events.

Nassim used to trade options. Nicholas Taleb looks at how and why people don't generally comprehend luck, the outsized role luck plays in success, and how, once we're aware of it, we can accept unpredictability in our life. Taleb mostly utilizes examples from the investing sector to illustrate his points, but his ideas apply to any area where there is a high degree of uncertainty (such as economics or politics), and they show how randomness may trick us in many other areas of our lives.

Our favourite quote from Fooled by Randomness

Heroes are heroes because they are heroic in behavior, not because they won or lost.

12 recommendations for Fooled by Randomness

12 recommendation for Fooled by Randomness

Book Summary

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Heroes are heroes because they are heroic in behavior, not because they won or lost.

— Nassim Nicholas Taleb, Fooled by Randomness