I've read many books, but only some of them had a profound impact on my thinking and perception. The most recent of these books is "20|20 Foresight: Crafting Strategy in an Uncertain World". Its logic is applicable to stock market, business and even personal life :-)
The book is written by a McKinsey guy who spent a lot of time advising companies on there decisions amidst uncertainty. He explains that uncertainty may be different. If the future outcome is not fully known, it doesn't mean that we know nothing. We could separate the unknown from unknowable, thus identifying information that helps to address threats and capture opportunites. For example, we could identify several MECE outcomes or a (non-MECE) range of outcomes. It's really helpful to correctly understand whether only several outcomes will occur and then prepare for those outcomes, or a range is known only so there is no point to focus on one particular state of the world in the future.
This first step allows to develop a strategy that maximizes the value function of the company given that range of future outcomes. Depending on a specific situation, the most effective strategy would include shaping or adapting, diversifying or focusing, acting immediately or postponing decisive actions. But identifying the exact type of uncertainty remains the first step. It's preferrable to making gut decisions.
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