Behavioral Investing Theory
from Uncommon Wealth Podcast Hosted by Phillip Ramsey
Certainly, with all the fancy computers and smart math folks in the world, there has to be a magic formula out there that balances risk and returns and gets the best investment returns out there for everyone, right? Even if there was such a thing (and we'll discuss modern portfolio theory out of the gate), there is a common variable that makes makes the math inadequate: You. Yes, humans are an unpredictable bucket of erratic of behavior who can spoil even the most prudent and successful investing theory. That's why it's important to factor in human behavior when making with, sticking to, and bailing from investment decisions. This week we'll talk about the behavioral investor theory and the things humans are prone to that can poison their own well, including having a confirmation bias, holding on to losers too long, taking on excessive risk due to overconfidence, and many more. To learn more about our philosophy, check out uncommonwealth.com, listen to the back episodes of this podcast, or shoot us an email at [email protected].
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