Posts filed under “Psychology”
This column warns investors to be wary of what they read and hear in the Financial Press.
Here’s the ubiquitous excerpt:
Have you ever noticed how the stock market reacts differently to the same
Why is it that we sometimes sell off "in response to rising oil prices," but
at other times the "market rallied, despite the rise in the price of crude"?
How come a selloff was caused by a suicide bombing in Iraq, but a week later,
the markets shrugged off an even larger, deadlier bombing? Is it possible that
the markets are responding to forces other than the latest headlines?
Short answer: Absolutely. Yes.
Longer answer: Keep reading.
Prior columns can be found here.
Nice piece by BMO Nesbitt on why investors fail: “Individuals have historically underperformed the markets, earning just 2.6% vs. the S&P 500 gain of 12.2% between 1984 and the end of 2002*. Research in the U.S. has shown that this dramatic underperformance comes as a direct result of client behaviour, or more specifically, the attempt…Read More
Is this the Magazine Indicator at work? First Fortune, now Time Magazine: We’ve seen some terrific Contrary market calls from magazine covers: Time magazine naming Jeff Bezos man of the year in December 1999 marked the top of the internet bubble; The March 21st 2005 Newsweek cover story, “The Incredible Shrinking Dollar,” marked a key…Read More