Lindy Effect & Stock Market

Investors often look at various theories to understand and predict stockmarket behaviour. Lindy Effect is one such theorised phenomenon whichhelps explain certain aspects of choosing stocks. Shreya Chaware deepdives into the Lindy Effect and deliberates on whether it can be useful inthe investing process

It is always interesting to analyse the success of some ofthe world-class portfolio managers such as WarrenBuffet. Investors often attempt to replicate the portfoliostrategy of the winners with the simple objective ofbeating the markets and it is no secret that a majority ofinvestors put in a lot of efforts to understand how Buffet pickshis stocks. If you are one of those investors who are eager tounderstand how he processes his investment decisions and ifyou were told he consciously or subconsciously uses LindyEffect in his investment – you would want to know more aboutthis enigmatic phenomenon.