Behavioral Finance

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Weekend Reading: The Greatest Paradox in Markets

Momentum from extreme highs and mean reversion from extreme lows create the “most powerful forces in markets”, prompting above-average returns.

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Weekend Reading: Endless Uncertainty

The words “Uncertainty” and “Unprecedented” have circulated news outlets more times throughout the past two years than possibly ever before. However, it’s important to note that the uncertainty we’re experiencing as a country today isn’t in theory higher than it was five or more years ago.

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Weekend Reading: Get Even-itis

In the world of investing, loss aversion is a cognitive bias which means your losses hurt twice as bad as any gains of the same value. It can be one of the most common (and challenging) hindrances to overcome in making sound investment decisions, and might also cause you to develop a case of “Get Even-itis”.

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Weekend Reading: Is It Really Better to Control Our Emotions?

When it comes to investing, you might have heard it’s best to separate your emotions from your financial decisions; however, doing so causes you to eliminate your life’s worth of wisdom.

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Weekend Reading: When the Optimists are Too Pessimistic

In reality, upside surprises occur more than we might realize, and this is due to what Magguilli refers to as “geometric growth”, versus our default way of viewing expansion, which is “linear growth”.

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Weekend Reading: The 'Perfect' Investor Has These Two Traits

When it comes to successful investing, Jack Bogle once advised, “Don’t do something; just stand there”, and he makes a fair point.

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Weekend Reading: Ten Insights from the Originator of Financial Therapy

The behavior and decisions you make around money root far deeper than you might ever realize.

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Weekend Reading: Fear and Greed: An Investor's Worst Enemies

With a lack of clarity still in the financial forecast, this article spotlights two fear and greed-based biases you will want to be aware of, so you can learn to not only manage them, but to also put more focus toward the long-term success of your investments.

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Weekend Reading: The Better You Are at Math, the More Money Seems to Influence Your Satisfaction

Were you a math pro in school? If so, new research shows it could benefit you more than you might realize.

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Weekend Reading: Behavioral Biases and the Hierarchy of Retirement Needs

The “bucketing” manner in which you might account for income and assets, as well as the hierarchy it develops, can cause you to save more money for retirement than you actually need.

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Weekend Reading: What You're Really Worried About When You're Worried About Money

Does money truly have the power to elevate your life? It can certainly take care of your most basic necessities, but according to Maslow’s Hierarchy of Needs, money has a limit on the amount of happiness it creates.