Common Investment Goals
Here are some common goals that investors have.
Surprise! Investors Often Don’t Know What Their Goals Are
Behavioral science can explain why it's surprisingly difficult for clients to accurately tell you their goals, but it can also provide ways to help.
Economists Can Tell You What You Should Want
Behavioral economists have made a lot of progress in disabusing their colleagues that humans are perfectly rational. That approach, though, goes only so far.
Taming the Panic Around Market Volatility
Unlike Tracy Jordan on "30 Rock," don’t panic when other investors are doing so. And if you must trade on a day like Aug. 24...
10 Myths About Risk Tolerance and How to Accurately Measure It
There are many myths about risk tolerance and how it can be applied in financial planning. Two authors from FinaMetrica clear up the confusion.
What Your Clients’ Personalities Say About Their Portfolios
Contemporary psychologists believe there are five basic dimensions of the human personality. These traits can influence financial behavior and investing patterns, a study found.
How to Protect Clients’ Retirement From Recency Bias
The human brain is naturally wired to want to invest more in top performing assets and to pull out of assets that have performed badly. This recency bias, as it's termed in behavioral finance, is always more pronounced at the beginning of a new year.
How to Sell Your ‘Invisible’ Services to Prospective Clients
A 1999 book by Harry Beckwith provides remarkable insights into marketing an intangible service like financial planning. Beware: they're not choosing you for your brilliance.
Kahneman: Clients Driven by Losses, Not Gains
Advice from the father of behavioral finance on the perils of hindsight, the power of client regret and what really sets apart Warren Buffett.
Investor Behavior by the Book
As you might imagine, people send me more books to review than I can possibly read. But "Investor Behavior" piqued my interest.