Whether you’re rolling over 401(k) into an IRA or tracking your portfolio activity, it’s easy to be overwhelmed by investing jargon, turbulent market activity, and navigating the storms of life. You want the most trustworthy, smoothest journey to your financial destination to enjoy the life you want to live.
What value does a financial advisor provide to investors? Many investors believe they are capable of producing above-average market returns on individual investing on their own, and they may be right. It’s likely they’re also facing significant risk they may be unaware of in regards to their financial future. There are three specific ways in which a financial advisor provides intrinsic value to investors...
When it comes to this year’s election of Donald Trump, there are a few things that are helpful to keep in mind....
One of the challenges that financial advisors face when meeting with clients for financial planning near their retirement is that many clients can no longer afford their insurance policies. Escalating costs for long-term care insurance, medical expenses, and life insurance are a threat to fixed-income retirees and near-retirees considering the cost of retirement.
s the saying goes, “People don’t know what they don’t know.” This leads us to the final investor behavioral bias that sometimes affects investors: the Bias Blind Spot, the inability to recognize our own tendency towards a particular behavioral bias or biases.
Does recent history make a difference in financial investment? Stock market prognosticators carry a track record of projecting ongoing investment trends based solely on most recent stock activity. A rising stock in recent weeks is expected to continue its upward trajectory into the future since there seems to be no indication otherwise. This can be a dangerous assumption, one which investors refer to as Recency Bias.
Each of us craves a good story. Imagine you’re at a dinner party and your friend shares this story, “I invested $72,591 in a stock that tripled in value within a week. I sold the stock yesterday and it’s paying for all three of our kids to attend college.” It’s an inspiring story and it may even be enough for you to go out and invest tens of thousands of dollars in a single stock option in search of that same windfall. This investor behavioral bias is simply called “Preferring Stories over Data”.
“Birds of a feather flock together… and so do investors.” Bernie Madoff masterminded one of the greatest affinity frauds in history. Madoff fleeced a large segment of the New York and Palm Beach Jewish communities of an estimated $20 billion by preying on a prominent investor behavioral bias known as herding. (Wall Street Journal)
