📖Howard Marks
Second-Level Thinking
Think deeper than the consensus to outperform.
First-level thinking is simplistic and superficial, and just about everyone can do it. Second-level thinking is deep, complex, and convoluted. The difference in workload between first-level and second-level thinking is clearly massive.
🏠 Everyday Analogy
📖 Core Interpretation
Howard Marks advocates a repeatable process: define criteria, execute consistently, and review decisions against evidence. Process quality drives outcome consistency.
💎 Key Insight：Average thinking produces average returns.
AI Deep Analysis
Get personalized insights and practical guidance through AI conversation
❓ Why It Matters
Without process, there is no reliable feedback loop. Structured execution and review improve decision quality over time.
🎯 How to Practice
Run a decision loop of research, thesis, execution, and post-mortem; document assumptions and update playbooks with evidence, not hindsight bias.
⚠️ Common Pitfalls
Having opinions without execution criteria
Reviewing outcomes but not decisions
Abandoning rules during volatility spikes
📚 Case Studies
1
Buying Distressed Debt in Global Financial Crisis (2008)
As panic selling swept markets, Marks patiently waited for steep discounts in high-yield and distressed bonds, buying only when expected returns compensated for extreme risk and fear.
✨ Outcome：Oaktree’s funds gained strongly in subsequent years as credit markets normalized and many distressed securities recovered.
2
Avoiding Overpriced High-Yield Energy Bonds (2015)
During the shale boom, investors eagerly funded energy issuers. Marks saw inadequate risk premiums and waited. When oil prices collapsed, many energy bonds fell sharply into distressed territory.
✨ Outcome：By staying patient, Oaktree later bought select issues at deep discounts, earning superior returns versus those who bought early at rich prices.
See how masters handle real scenarios?
30 real investment dilemmas answered by legendary investors
Explore Scenarios →