What I did over my Summer Vacation

Summer_bear_mkt

via The New Yorker

Category: Markets

The Psychology Behind Common Investor Mistakes

From R. Douglas Van Eaton, CFA, professor of finance in the
College of Business Administration at the University of North Texas, discusses common investor errors:

Overconfidence

Fear of regret/pain of regret

Cognitive dissonance

Anchoring

Representativeness

Myopic risk aversion

Van Eaton notes" A better understanding of the psychology of investor mistakes can
reduce their effects on investment decisions. Here is a list of the
most common psychological effects, and how you can reduce their impact
and incorporate them into your own investment decisions."

The full piece is below.

>

Source:
The Psychology Behind Common Investor Mistakes
R. Douglas Van Eaton
AAII Journal
http://www.aaii.com/promo/evergreen/basics/jrnl200004p02.cfm

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