What can investors learn from Sherlock Holmes?

Legendary detective Sherlock Holmes can teach stockpickers a great deal about investing. His approach to solving crimes is mirrored in Artemis’ tool SmartGARP, for example, and the lessons from his cases can aid investors. In one story, Holmes solves a mystery by 'reasoning backwards'. Many fund managers try to reason forwards, hoping it will lead them to outperform. But that approach relies on forecasting and intuition, whereas reasoning backwards starts with the result investors want and traces it back to the factors that deliver it. In another adventure, Holmes warns that forming theories...