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Interview with Wim Steemers

Behavioural Science is a rapidly expanding field and everyday new research is being developed in academia, tested and implemented by practitioners in financial organisation, development agencies, government ‘nudge’ units and more. This interview is part of a series interviewing prominent people in the field. And in today's interview the answers are provided by Wim Steemers.

Wim is a Behavioural Science practitioner, rather than an academic. While he has no formal academic degree in Behavioural Science, he has undertaken extensive studies, and applied it to the field of stock market investing. He has been a professional investor for twenty years, and has spent the past three years building a portfolio construction algorithm that explicitly takes behavioural biases as its input, quantifies the resulting share price distortions, and construct a portfolio that is expected to outperform its benchmark by over 10% per year on a consistent basis. Also, if you think the name and topic sound familiar, Wim has actually written two articles for this blog before, both on behavioural finance, and how to use behavioural science in improving your investment strategy! Make sure to read part 1 and part 2 to get properly acquainted!


Who or what got you into behavioural science?

It was a combination of a long-standing discomfort with the notion of Efficient Markets, coupled with discussions with my close friend Bruce Rigal, who had recently completed a degree in Behavioural Science. I was taught in business school (many years ago, I might add), that stock markets are “efficient”. This is a term that means that all available information is immediately reflected in stock prices, which would suggest that it is impossible to consistently generate above-average returns in the stock market. Once I became a professional investor I always struggled with this notion – essentially the theory said that my pursuit was futile! To some extent I comforted myself with the thought that markets are efficient only by virtue of the fact that people like myself are making an effort to pick the best stock, and that this is the way that “all available information”, as the efficient markets theory says, makes its way into the market. But still… A couple of years ago I had some free time to study the tenets of Behavioural Science/Behavioural Finance. As it turned out, Behavioural Finance offers a viable alternative to the efficient markets theory, and it reflects much better my experience in markets over twenty years.


What is the accomplishment you are proudest of as a Behavioural scientist? And what do you still want to achieve?

As mentioned, I am a practitioner, applying Behavioural Science/Behavioural Finance in the area of stock market investing. I am most proud of the fact that I have been able to construct an investment strategy that uses Behavioural Finance principles to generate above-market returns. The Rosevalley Funds have been operating for about two years, and its investment returns have consistently been at the level of the top-10 funds in Australia as surveyed by Mercer (the leading research house into managed funds). You can find more about this at


If you weren’t a behavioural scientist, what would you be doing?

I would still be a professional investor – I would just have to live with a little more cognitive dissonance!


How do you apply behavioural science in your personal life?

Probably not as much as I should. But I would say the area of conflict resolution is where I use it most. At times of conflict it helps to stop and ask yourself: “why is that person behaving like this or saying that, and why am I reacting to that in this particular way?”.


With all your experience, what skills would you say are needed to be a behavioural scientist? Are there any recommendations you would make?

The answer is probably: “The same skills as you need to be any kind of scientist”. This is first and foremost an ability to ask the right questions. Then there is the need for rigorous, logical thinking, some maths and statistics, perseverance, the ability to question your own assumptions, and so on. The advice I would give to anybody who is contemplating a career in science: study maths (all science needs it), and never, ever, ever, stop being curious. There is always a next question, a deeper layer – this is how science progresses.

As an aside, one question which I find particularly interesting in this context is: What does Behavioural Science tell us about the behaviour of scientists in general, and behavioural scientists in particular? Is the research about biases coloured by the researcher’s biases? If so, how? And how would you know? Can you still trust the research?


How do you think behavioural science will develop (in the next 10 years)?

I’m not sure about the broader field, but on the narrower field of Behavioural Finance, I agree with Richard Thaler: in 10 years there will no longer be such a thing as “Behavioural Finance”[1] – it will just be “Finance”.


Which other behavioural scientists would you love to read an interview by?

I would say Professor Hersh Shefrin. Of all the research I studied, his papers had the most direct impact on the design of the Rosevalley methodology.


Thank you for these great answers Wim! I'm glad you recognise your own cognitive dissonance had you stayed in "regular" finance. Also, I will try my best to reach out to Prof. Shefrin!

As I said before, this isn't Wim's first appearance on this blog, so do check out his earlier articles linked in his bio. Moreover, this interview is part of a larger series which can also be found here on the blog. Make sure you don't miss any of those, nor any of the upcoming interviews! Keep your eye on Money on the Mind!


[1] The End of Behavioral Finance - Author(s): Richard H. Thaler Financial Analysts Journal, Vol. 55, No. 6, Behavioral Finance (Nov. - Dec., 1999), pp.12-17. Published by: CFA Institute. Stable URL:


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