Saturday, August 3, 2013

Experience vs Intelligence

I came upon this diagram on the net and was discussing with my wife. Which of the two is more important: Experience or Intelligence.
Based on the diagram, intelligence without experience equals to "knowledge". This is a typical student traits. A student who learns and knows the theory on the back of the head but have no experience in real life situation.
On the other hand, experience without intelligence equals to "information". This is similar to a typical information center we find in shopping center. They would know if you ask them questions within the boundary of the information they know. Beyond that, they would be unable to think out of the box and give you a satisfactory answer.
Ideally, it should be a balance between the two. Experience combined with Intelligence equals to "Wisdom" - a comprehension of an optimum judgment of action coupled with insight. This is where everyone should aim for.


  1. If I may add a third dimension, it is "Temperament". All investors need experience (to know about market history), intelligence (to do valuations) and the right temperament (not to fall victim to biases, illusions and fallacies).

    Having all three is, to me, called "Insight".

    1. Hi MW

      I thought all along that with experience comes temperamen. So the more you have experience the better you are with your temeperament. Isnt that so?

  2. B,

    Wisdom is recognising the limitations of experience AND intelligence.

    Knowing when to discard or defer to which takes courage and lot's of self-belief.

    On a fun note, wisdom is also not getting into a discussion which is better? It's like asking both mom and wife fell into the river, who would you save first?


    In front of wife say it's you my love!

    In front of mother of course it's you mommy dearest!

    Only an idiot would hazard an answer when both are present!


    Now is that experience or intelligence?

    1. Hi SMOL

      Interesting thoughts you have.

      Is there one ahead of wisdom? I thought wisdom is eternity the most ultimate level of knowledge you ever have.

      Of course with complete wisdom we will be confused with such questions relating to wife vs mother. Hahaha. That needs courage.

    2. I will jump into river immediately.

      Oh no! Save me , save me. I can't swim.


    3. Hahaha well thats another test of who loves you more. Your wife or mother ;)

  3. Hi B,

    These days I would prefer experience. Knowledge is over-rated. Most of the knowledge in the world are generated by people who do, rather than doing after knowing how to do. There are a few exceptions, like mathematicians and theoretical physicists though.

    With experience, you can also innovate and think out of the box. With knowledge, you might not want to innovate. I think innovation has nothing to do with either experience or knowledge. You think out of the box when you have to think out of the box :)

    1. Hi Lp

      With experience I think one can innovate but with more trial and error. With knowledge, dont you think the trial and error can be diminished to the min? Or maybe a person who innovates just have that piece of genius in their mind.

    2. Hi B,

      Most of the world's discoveries are made by trial and error. Theory comes after trial and error, not before. It's a myth that theory leads to practical knowledge; it should be practice leads to theory. Theory (i take it as knowledge) is bounded by existing framework of thought but trial and error is not bounded, except by chance/randomness. E.g. discovery of penicillin, kevlar, use of viagra as an anti-impotence drug etc. Very seldom are discoveries lead by information or theory.

    3. Hi LP

      Thanks for sharing.

      I can't agree with you more.

  4. Warren Buffet :- "the critical determinant in an investor's success is not intelligence or skill but temperament"