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Showing posts from September 15, 2021

Strategy Hopping: Hazardous To Your Wealth!

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Performance Chasing Bias Humans are (unfortunately) hard-wired to attempt in keeping up with the "Joneses." This causes us to admire that new dress, lust after that new car, or drool over those seemingly perfect images from their recent dream vacation posted on social media. Not only is this bad for our emotional health, but it can be catastrophic for our financial wealth. We only see the surface and not what may be lurking underneath the pretty picture painted on the outside. In a similar fashion, we may be tempted to invest in securities (bonds, stocks, or funds) that have been on a recent tear. Worse yet, we may overhear our neighbors - Bobby and Bunny Jones - gushing over the killing they made investing in crypto at the end of summer neighborhood BBQ. This is just the situation that causes us to make an emotional decision with our stomach just when we need to make a rational decision with our brain. Performance chasing bias has been shown to detract x.xx% of investor retu