Research
on human investment behavior indicates how personal psychology has to do with the way securities markets operate.
I
have mentioned in the past my studies and evaluations of over 1,600
investment strategies, and their pros and cons. In addition, I have
always said there is no one that I have found to be better than any
other. What makes for investment success is strict discipline of
strategy use.
Psychology controls discipline. Furthermore,
discipline can be mastered, with proper personalized control over
those psychological hazards.
I
would suggest investors look at the work done by Kahneman and Tversky
on investing behavior. It will provide a glimpse of how investors
think, often to their disadvantage. (See the Earl J. Weinreb
NewsHole® comments.)
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