Dan Kahan, at the Yale Law School, has studied motivated reasoning and found that smart people may use their intelligence opportunistically to promote their interests and beliefs and not to seek the truth or extract unbiased conclusions from data. This conclusion is explored in the paper "Motivated Numeracy and Enlightened Self Government".
This work tests two theories about the societal conflict over risk in the face of scientific evidence. One theory, the "science comprehension thesis" (SCT), identifies defects in the public's knowledge and reasoning capacities as the source of controversies about policy. The public does not understand the research on a topic. The other theory, the "identity-protective cognition thesis" (ICT), treats cultural conflict as the faculties that members of the public use to make sense of decision-relevant science. Our biases can stop us from seeing the truth in data.
In this paper, the researchers test numeracy with a neutral topic and found that those with better number skills were better able to derive conclusions concerning data on skin rashes. However, they found that when a politically charged topic was tested, like gun control, the subject became politically polarized and analysis is less accurate. More importantly, the polarizations did not decrease based on numeracy but actually increased. Smart people may show greater biases consistent with their political views over what the data present.
Smart portfolio managers may use their knowledge to support and convince themselves of their views. They often advocate for their position and not seek the truth in data. They may have the right position for the right reasons because they are smart, but it is also possible that they have a wrong position even in the face of counterevidence. This does not mean that they specifically try to convince you of a wrong position. It may just be their goal is to use their intelligence to advocate for their views.
Smart does not always mean seeking the truth. Even smart people can be blinded not by their behavioral biases but by the biases of their preconceived opinions. Smart does not mean advocating the correct view or being open to other ideas.
Do want to invest with position advocates or data analysts? If you are not sure which one is your manager, make a third choice and follow a manager who is driven by rules.