There’s a saying I’ve heard through the years, “Nobody loses in Vegas “. This makes me think of a relatively new area of financial study amongst many of the top university finance programs. The area of study is designed to understand better about investor behavior and psychology. We have learned more about this particular field from experts like Terrance Odean at UC Berkeley.
It has become very clear that the fight or flight response that we are inherently born with, was great when we were being chased by sabertooth tigers, however today a lack of understanding in the way we are hardwired can be detrimental to one’s ability to really succeed with their portfolio management. What’s interesting is the biggest group of people that fall into this trap, of false patterning and looking for insight as to how the market will act, is perpetuated by investment advisors. Do not fall prey to slick emotional-based marketing, rather get educated. Check out our free financial resource page and find out how education may save you from your hardwired instincts.