The field of behavioural finance studies the way people make financial decisions. Understanding how deep-rooted emotional responses affect investment decisions is the first step in overcoming the wealth-destroying impact of human psychology.
-The Trimark way
The ability to maintain discipline throughout market cycles is crucial to overcoming the negative patterns. The following patterns have been identified across a broad spectrum of investors.
A financial advisor can help mitigate the impact of an investor’s emotional reactions. By maintaining proper asset allocation and encouraging investment discipline, financial advice can be the key to reaching your long-term financial goals.
Source: Invesco, The Economist, July 5, 2003