Why Do Jim O'Shaughnessy's Trading Models Beat Human Stock Pickers?

Jim O'Shaughnessy told Howard Lindzon on Lindzanity that models built from data beat human judgment in college admissions, in predicting which prisoners reoffend, and in doctors' diagnoses. People built the models and still lost, because human choices are inconsistent and the cause is almost always emotion. That research became his books, especially What Works on Wall Street. He calls fear, greed, hope, and ignorance the four horsemen of the investment apocalypse. Only ignorance is not an emotion, and reading can fix it. Fear, greed, and hope have destroyed more portfolios than anything else. He pointed to Richard Feynman dropping a Challenger O-ring into ice water and saying he thought that was the problem.