For most physics students, the introduction of Richard Feynman’s lectures would have made learning a joyful adventure by the sheer simplicity of Feynman’s teachings. In this article, Morgan Housel references Feynman to drive home the point that when it comes to advice, especially financial advice, simplicity struggles. We at Marcellus can relate to this as we reflect on our sales pitches. The selling pitch of buying high quality companies and holding them for long periods of time somehow draws a yawning response from prospective clients. On the contrary there are easy takers for a complex derivative structure which the client can’t comprehend. As Housel quotes computer scientist Edsger Dijkstra: “Simplicity is the hallmark of truth— we should know better, but complexity continues to have a morbid attraction. When you give for an academic audience a lecture that is crystal clear from alpha to omega, your audience feels cheated and leaves the lecture hall commenting to each other: “That was rather trivial, wasn’t it? The sore truth is that complexity sells better.”
Housel explains four reasons why complexity sells:
1. Simplicity feels like an easy walk. Complexity feels like mental CrossFit.
If the reps don’t hurt when you’re exercising, you’re not really exercising. Pain is the sign of progress that tells you you’re paying the unavoidable cost of admission. Short and simple communication is different. Richard Feynman and Stephen Hawking could teach math with simple language that didn’t hurt your head, not because they dumbed down the topics but because they knew how to get from A to Z in as few steps as possible. An effective rule of thumb doesn’t bypass complexity; It wraps things you don’t understand into things you do, like a baseball player who – by keeping a ball level in his gaze – knows where the ball will land as well as a physicist calculating the ball’s flight with precision.
The problem with simplicity is that the reps don’t hurt, so you don’t feel like you’re getting a mental workout. It can create a preference for laborious learning that students are actually OK with because it feels like a cognitive bench press, with all the assumed benefits.
2. Length is often the only thing that can signal effort and thoughtfulness.
The U.S. constitution is 7,591 words. A typical business management book covering a single topic is perhaps 250 pages, or something like 65,000 words.
The funny thing is the average reader does not come close to finishing most books they buy. Even among bestsellers, average readers quit after a few dozen pages. Length, then, has to serve a purpose other than providing more material. My theory is that length indicates the author has spent more time thinking about a topic than you have, which can be the only data point signaling they might have insight you don’t. It doesn’t mean their thinking is right. And you may get enough of their thinking after two chapters. But the purpose of chapters 3-16 is often to show the author has done so much work that chapters 1 and 2 might have some insight. Same for research reports and white papers.
3. Things you don’t understand create a mystique around people who do.
If you say something I didn’t know but can understand I might think you’re smart. If you say something I can’t understand I might think you have an ability to think about a topic in ways I can’t, which is a whole different species of admiration. When you understand things I don’t I have a hard time judging the limits of your knowledge in that field, which makes me more prone to taking your views at face value.
4. Complexity gives a comforting impression of control, while simplicity is hard to distinguish from cluelessness.
In most fields a handful of variables dictate the majority of outcomes. But only paying attention to those few variables can feel like you’re leaving too much of the outcome to fate. The more knobs you can fiddle with – the 100-tab spreadsheet, or the Big Data analysis – the more control you feel you have over the situation, if only because the impression of knowledge increases. The flip side is that only paying attention to a few variables while ignoring the majority of others can make you look ignorant. If a client says, “What about this, what’s happening here?” and you respond, “Oh, I have no idea, I don’t even look at that,” the odds that you’ll sound uninformed are greater than the odds you’ll sound like you’ve mastered simplicity.

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Note: the above material is neither investment research, nor financial advice. Marcellus does not seek payment for or business from this publication in any shape or form. Marcellus Investment Managers is regulated by the Securities and Exchange Board of India as a provider of Portfolio Management Services. Marcellus Investment Managers is also regulated in the United States as an Investment Advisor.

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