The Madness of Markets

“A fascinating and indispensable guide to the hidden psychology that drives markets.”—Annie Duke, decision strategist and author of Thinking in Bets and Quit

“A dazzling summation . . . a stunning indictment of human weaknesses, with numbers attached.”—Bloomberg

“We all like to think we are terribly clever, or that our stockbroker must be—otherwise why are they charging such big fees? But let’s not kid ourselves. Many of us are like the fools who—in the early days of Covid—sent the share price of Zoom Technologies, a semi-dormant Chinese company, up 1,500 per cent, because they mistook it for Zoom, the video conference company. . . . The trick is to recognize that you are a fool and avoid others’ greater foolishness. Edmans’s book is a very useful primer.”—The Times

“An entertaining writer . . . Edmans summarizes the field of behavioral finance with a refreshingly light touch”—Jason Zweig, Wall Street Journal columnist and author of Your Money and Your Brain

“A masterclass . . . a must-read for anyone interested in behavioral finance.”—Katy Milkman, Wharton professor and author of How to Change

“A cool-headed compass . . . punchy, witty, and provocative.”—Gillian Tett, Financial Times columnist and author of Anthro-Vision

“Essential reading on how markets work.”—Michael Mauboussin, managing director at Morgan Stanley and author of More Than You Know

“Actionable advice on how investors can take advantage of these mistakes.”—Aswath Damodaran, NYU professor and author of The Little Book of Valuation

“An incredibly useful and entertaining handbook”—Rory Sutherland, vice chairman of Ogilvy and author of Alchemy

“The author is that rare academic (he teaches at the London Business School) who can write engagingly about finance and at the same time offer sound—and not always obvious—advice about how to manage your own finances. In The Madness of Markets, Alex Edmans dissects the psychology of how we look at life in single frames rather than as a movie—which means we are always extrapolating a single data point into a trend, and trends often prove illusory. Edmans covers a lot of terrain and helpfully provides a glossary, but never once does he lose the reader.”—Air Mail

“The ideal user’s guide to the next financial bubble.”—Ed Conway, Sky News economics editor and author of Material World

“A maddeningly good read.”—Robin Wigglesworth, finance journalist and author of A Fabulous Debt