"And there is one bias that all of us share, whether your smart or not as smart and that is a tendency to extrapolate. So what we -- if we've seen good results, we think they're going to go on forever. If we've seen something bad, we think it's going to go on forever. And that leads to what I think is the biggest mistake in investing, which is failure to distinguish between fundamentals and expectations. Fundamentals, basically how the company is going to perform in terms of sales and profits and expectations is what's embedded in the stock price."
Ht to Farnman Street.