Behavioral Finance

Weekend Reading: Why Do We Keep Making the Same Investment Mistakes?
As an investor, you learn from painful investment periods in the near-term, but over the long-term, behavior doesn’t typically change.

Weekend Reading: Why Can’t We Stop Changing Our Investment Process?
A “leave it be” mindset when it comes to your lifelong savings is easier said than done. You know you have a sound investment strategy, but alas, the temptation to tinker is strong. Why?

Weekend Reading: The Thrill of the Trade
We know that investing over the long-term is where wealth is made, but this doesn’t change the fact that there is excitement in playing the market game.

Weekend Reading: Learning to Be a Good Investor is Hard
What makes a good investor? While mastering the art of patience plays a role, it also comes down to learning and feedback.

Weekend Reading: Four Things Poker Taught Me About Investing
Investment planning isn’t synonymous to gambling in a casino, but the two realms do share insight that can lend valuable lessons to today’s investors.

Weekend Reading: The Perfectly Imperfect Investor
In the world of investing, critiquing prior financial choices is common, and is what economists refer to as “hindsight bias”.

Weekend Reading: Five Lessons from History
As author Morgan Housel says, historical events which reap takeaways that can be applied to broad areas of life often contain some of the most valuable insight.

Weekend Reading: The Greatest Paradox in Markets
Momentum from extreme highs and mean reversion from extreme lows create the “most powerful forces in markets”, prompting above-average returns.

Weekend Reading: Endless Uncertainty
The words “Uncertainty” and “Unprecedented” have circulated news outlets more times throughout the past two years than possibly ever before. However, it’s important to note that the uncertainty we’re experiencing as a country today isn’t in theory higher than it was five or more years ago.

Weekend Reading: Get Even-itis
In the world of investing, loss aversion is a cognitive bias which means your losses hurt twice as bad as any gains of the same value. It can be one of the most common (and challenging) hindrances to overcome in making sound investment decisions, and might also cause you to develop a case of “Get Even-itis”.

Weekend Reading: Is It Really Better to Control Our Emotions?
When it comes to investing, you might have heard it’s best to separate your emotions from your financial decisions; however, doing so causes you to eliminate your life’s worth of wisdom.

Weekend Reading: When the Optimists are Too Pessimistic
In reality, upside surprises occur more than we might realize, and this is due to what Magguilli refers to as “geometric growth”, versus our default way of viewing expansion, which is “linear growth”.