behavioural psychology

Contributors

How advisers can tap into overconfidence bias for new client opportunities

Overconfidence is the natural enemy of the self-directed investor. It tends to lead to higher risks and lower returns. For advisers, overconfident investors present both a challenge and an opportunity. From a behavioural finance perspective, overconfidence means we tend to under-estimate the level of uncertainty in our decision-making. Overconfidence becomes particularly dangerous when paired with […]
Investment

Forecasts, far from the madding crowd

Warren Buffett’s wise decision to base himself in Omaha, far from the chatter of Wall Street, was affirmed by two recent news events. These events – the International Monetary Fund’s series of U-turns in early September on its widely scrutinised global economic assessment and the market’s increasingly confident bet that Bank of England governor Mark […]