Wim Steemers – Overcome Behavioral Biases with the Help of a Good Team

Wim Steemers has a 30-year career working in over 40 countries around the world, of which the last 20 years were spent in funds management at AllianceBernstein, Macquarie, Colonial First State, and AL Capital. While educated at the University of Chicago’s Booth School of Business, he always had his doubts about the Efficient Market Hypothesis, and he followed the development of Behavioral Finance over the years with keen interest. While he has a traditional fund management role at AL Capital, he spends his free time with his Rosevalley Funds, where he puts into action what he suspected for a long time: there has to be a way to take advantage of the systematic biases that exist in human behavior.   “People do not always behave rationally. They make errors in a particular direction, and if you’re aware of these behavioral biases, you’re gonna make money.” Wim Steemers   Worst investment ever New technology rouses his curiosity In 1999, a new technology of doing laser operations on eyes to correct vision piqued Wim’s interest. Wim had been wearing glasses since he was four years old, so anything to correct his vision was bound to interest him. Though the technology was relatively new, it had been proven to work, but it was still quite rare and expensive. Wim, however, decided to do it. Falling in love with the product The laser procedure took about 15 minutes, and voila Wim had perfect vision. For 30 years, Wim had not been able to see further than a meter ahead without glasses. When he walked out of the room, and he could see perfectly. It was literally as if the sun had risen for the first time in his life. The machine used for the laser procedure was big and cost a million dollars at the time. It was made by a Canadian company that was listed in the stock exchange. When Wim walked out of that operation, he was so impressed and believed that this machine was going to take the world by storm. So he bought shares in the company that made that laser equipment. The company wasn’t as good as the product Within about a year, Wim lost all his money after the company went bankrupt. Wim had done no research and simply thought that the laser machine was so great the company must be doing well. So it turned out that there were competitors that had cheaper products and better laser machines. So the company just couldn’t compete, and that’s how Wim lost all his money. Delving into the Korean investment market In the year 2000, while working as a junior analyst, Wim got a chance to delve into the Korean stock exchange. At the time, Asia was just getting out of the 1997