- Recency bias, probability neglect and aversion loss are just a few of the concepts that we, as humans, find difficult to avoid in our investing.
- The average U.S. investor underperformed the market by 7.4% per year in the last 30 years as a result of taking action under the influence of emotions.
- Fundamentals, valuations and dollar cost averaging can help you put your emotions aside.
Today we’ll discuss how humans aren’t really mentally prepared for investing. We are wired to survive in the woods with a freeze, fight or flight system, which has nothing do to with the markets. There is no threat of death when it comes to investing in the markets. More →