Discover how to remove behavioral bias from your investment decisions
For many financial professionals and individual investors, behavioral bias is the largest single factor behind poor investment decisions. The same instincts that our brains employ to keep us alive all too often work against us in the world of finance and investments.
Investing Psychology + Website explores several different types of behavioral bias, which pulls back the curtain on any illusions you have about yourself and your investing abilities. This practical investment guide explains that conventional financial wisdom is often nothing more than myth, and provides a detailed roadmap for overcoming behavioral bias.
* Offers an overview of how our brain perceives realities of the financial world at large and how human nature impacts even our most basic financial decisions
* Explores several different types of behavioral bias, which pulls back the curtain on any illusions you have about yourself and your investing abilities
* Provides real-world advice, including: Don't compete with institutions, always track your results, and don't trade when you're emotional, tired, or hungry
Investing Psychology is a unique book that shows readers how to dig deeper and persistently question everything in the financial world around them, including the incorrect investment decisions that human nature all too often compels us to make.
Autorentext
TIM RICHARDS is the creator of the Psy-Fi Blog (www.psyfitec.com), a unique website dedicated to analyzing, explaining, and integrating the vast body of research on the impact of psychology in finance. As a uniquely focused resource for behavioral investing, the website attracts as many as 25,000 unique visits a month and is regularly featured in the largest information aggregators and websites in the financial industry.
Zusammenfassung
Discover how to remove behavioral bias from your investment decisions
For many financial professionals and individual investors, behavioral bias is the largest single factor behind poor investment decisions. The same instincts that our brains employ to keep us alive all too often work against us in the world of finance and investments.
Investing Psychology + Website explores several different types of behavioral bias, which pulls back the curtain on any illusions you have about yourself and your investing abilities. This practical investment guide explains that conventional financial wisdom is often nothing more than myth, and provides a detailed roadmap for overcoming behavioral bias.
- Offers an overview of how our brain perceives realities of the financial world at large and how human nature impacts even our most basic financial decisions
- Explores several different types of behavioral bias, which pulls back the curtain on any illusions you have about yourself and your investing abilities
- Provides real-world advice, including: Don't compete with institutions, always track your results, and don't trade when you're emotional, tired, or hungry
Investing Psychology is a unique book that shows readers how to dig deeper and persistently question everything in the financial world around them, including the incorrect investment decisions that human nature all too often compels us to make.
Inhalt
Preface xiii
CHAPTER 1 Sensory Finance 1
Beating the Bias Blind Spot 1
Illusory Pattern Recognition 4
Superstitious Pigeonsand Investors 6
The Super Bowl Effect: If It Looks Too Good to Be True, It Is 9
Your Financial Horoscope: Forecasting and the Barnum Effect 10
Uncertainty: The Unknown Unknowns 12
Illusion of Control 13
Stocks Aren't Snakes 15
Herding 16
Availability 19
Assuming the Serial Position 21
Hot Hands 23
Financial Memory Syndrome 25
Attention! 27
The Problem with Linda 29
Representation 31
The Seven Key Takeaways 33
Notes 34
CHAPTER 2 Self-Image and Self-Worth 37
The Introspection Illusion 37
Blind Spot Bias, Revisited 39
Rose-Colored Investing 40
Past and Present Failures 41
Depressed but Wealthy 43
Disposed to Lose Money 44
Loss Aversion 45
Anchored 46
Two Strangers 48
Hindsight's Not So Wonderful 50
Deferral to Authority 51
Emotion 52
Black Swans 54
Dirty Money, Mental Accounting 55
A Faint Whisper of Emotion 56
Psychologically Numbed 57
Martha Stewart's Biases 58
Retrospective 60
Annual Returns 60
Nudged 61
Mindfulness 62
The Seven Key Takeaways 65
Notes 66
CHAPTER 3 Situational Finance 69
Disposition vs. Situation 69
Beauty Is in the Eye of the Investor 70
Angels or Demons? 71
Merely Familiar 73
Lemming Time 74
Story Time 76
Wise Crowds? 78
Adaptive Markets 79
George Soros's Refl exivity 81
Grow Old Quickly 82
Speaking Ill 83
The Power of Persuasion 85
SAD Investors 86
Sell in May . . . 87
The Mystery of the Vanishing Anomalies 89
Tweet and Invest 90
Fire! 92
The Rise of the Machines 93
The Seven Key Takeaways 94
Notes 95
CHAPTER 4 Social Finance 99
Conformor Die 99
Groupthink 100
Motivated Reasoning 101
Polarized 103
A Personal Mission Statement: Social
Identity and Beyond 104
Gaming the System 106
You've Been Framed 108
Behavioral Portfolios 110
Dividend Dilemmas 112
The Language of Lucre 113
Embedded Investing 114
Financial Theory of Mind 116
Trust Me, Reciprocally . . . 118
Akerlof's Lemons 119
The Peacock's Tail 122
Facebooked 123
Be Kind to an Old Person 124
The Seven Key Takeaways 126
Notes 127
CHAPTER 5 Professional Bias 131
Mutual Fund Madness 131
Is Passive Persuasive? 133
Losing to the Dark Side 134
ForecastingThe Butterfl y Effect 136
Forecaster Bias 138
Feminine Finance 140
Trading on a High 141
Marriage and Money 142
Muddled Modelers 144
CEO PayBecause They're Worth It? 145
Corporate Madness 146
Buyback Brouhaha 148
Oh No, IPO 149
Your 6 Percent Self-Infl icted Trading Tax 150
Expert Opinion? 151
Avoid the Sharpshooters 153
The Seven Key Takeaways 154
Notes 154
CHAPTER 6 Debiasing 159
Numbers, Numbers, Numbers 159
Losing Momentum 160
Mean Reversion 162
Short Shift 163
Diworsification 165
Disconfirm, Disconfi rm 167
Reverse Polarization 168
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