Last Friday I mentioned that every source, including this one, has biases and conflicts of interest. A few readers asked for clarification regarding my biases, so I thought it would be a good idea to go over them to help you better evaluate the information you receive here.
My Conflicts of Interest
First and most obviously, I have some conflicts of interest due to the fact that I participate in a handful of affiliate programs:
- Legalzoom and MyCorporation.com,
- Mint.com, and
If you’re not familiar with what affiliate programs are, I’d encourage you to read this article. In short, I receive a commission any time you follow a link from my site to one of those sites and buy their products or sign up for their services. This means I have a conflict of interest in that it’s more profitable for me to recommend these companies rather than their competitors.
Obviously Amazon is the most relevant one because I rarely link to or discuss the other companies. Fortunately, Amazon does actually tend to be the lowest-cost place to buy the books that I publish.
More importantly, like any human, I have a whole list of natural biases.
The one that probably has the largest effect on this blog is known as confirmation bias. That is, once I’ve taken a position on a topic (either in an article, in one of my books, or with my own portfolio), I have a natural inclination to:
- Read articles and studies that confirm I’ve made good choices with the positions I’ve taken rather than sources that would indicate the opposite, and
- Be undesirably closed-minded about sources providing opposing viewpoints.
I do make a point to expose myself to opposing viewpoints on a fairly regular basis. But the reason I have to make a point to do this is because my natural inclination is to do just the opposite.
This (unintentional) filtering of sources probably slants the information I provide here in favor of the things that I already believe in — things like:
- The benefits of maintaining a simple portfolio,
- The benefits of keeping costs low, and
- The idea that markets are mostly efficient and not easily beatable.
In other words, this bias probably results in me overstating my case at various points in time. I’d love to give you an objective assessment of the degree to which this happens. But I can’t. I’m biased.