Personal Finance Essentials
Herd Mentality Bias
- Back to Investment Management
- Start Now – and Never Stop
- Put Compounding to Work for You
- Maintain a Long-Term Perspective
- The Cost of Procrastination
- The Two Ways to Manage Your Investments
- The Power of Diversification
- Modern Portfolio Theory: A Scientific Approach to Investing
- The Importance of Rebalancing
- The Best Investment Approach of All: Dollar Cost Averaging
- Keeping More of Your Profits via Tax Loss Harvesting
- The Goal of Investing: Financial Security
- The Hidden Threat: Inflation and Taxes
- Understanding Risk and Volatility
- The Psychology of Investing: Overcoming Emotional Errors That Prove Costly
The Psychology of Investing > Herd Mentality Bias
People tend to buy or sell merely because other people are buying or selling.
The problem is that most people are poor investors – meaning following the crowd usually results in poor results. Don’t buy or sell merely because your friend says they are. If everyone were right, everyone would be rich. Whatever strategy you choose, you need a better reason than “the person next to me is doing it.”
