Applying second level thinking to purchasing consumer electronics.

Okay, now that I've begun to understand what second level thinking means, I want to apply it to real life. Since I'm interested in technology and gadgets, it struck me that second level thinking is a philosophy consumers should use when they buy a product. I have always been a 'first-level thinking consumer'. When Apple launches a new phone, I always say, 'I want that phone-it's the best phone on the market'. However, I realised that a second level thinker might say that although Apple makes the best phone, you can buy a One plus  or Xiaomi phone which is almost as good at half the price, hence rendering the iPhone a bad purchase. However, it could also be argued, that phone companies such as One plus and Xiaomi do not provide reliable customer services, that their phones malfunction frequently, and are less user-friendly or have poorer software than an iPhone. Hence, the value a consumer puts to user-interface and reliability must be greater than the extra cost of the iPhone. In conclusion, the price paid for a stock must be less than the calculated (present day or future) value.

The most important thing.....second-level thinking

Okay, so I just started reading The most important thing, and I've finished the first chapter. Here's what I learned in chapter 1:

In the first chapter, Howard Marks stresses the importance of second level thinking. What is second level thinking? Second level thinking-from what I have understood-is the process of analysing all the opinions, the possible outcomes, and the probability of these outcomes. This is because, in order to be a successful investor, you have to regularly outsmart a generally efficient market. To achieve that, you have to hold an opinion different to that of the consensus, and be certain of its probability. He gives the example that a first level thinker might say, "its a good company-buy", whereas a second level thinker might say "its a good company, but everybody thinks its a great company-sell".

The Story

Hi, my name is Adit. This story began due to my love for cars. My father said that he would allow me to invest a specific amount every year so that I could use the money to buy a car on my 21st birthday.  My first investment-Tesla motors led me to read deeply into the company, and I developed an interest in investing and hypothesising about potential breakthrough companies. Hence, I asked my father for a page turner about investing, and he recommended The most important thing by Howard Marks who is the co-founder of Oaktree capital. So, we came up with the idea that I should create a blog about my investment lens, because the lens of a fifteen year old is very different from that of the older generation, which is currently engaged in investing. In this blog, I will talk about interesting books and videos I have watched or read, put my investments through the tests presented by the different streams of thought which I will attempt to understand, and blog about my reasons for the investments in my portfolio. Thus begins my investment story...