Michael M. Pompian (CFA, CFP, Hammond Associates)

Behavioral Finance and Your Portfolio

A Navigation Guide for Building Wealth

• Gebundenes Buch

Produktbeschreibung

Become a more strategic and successful investor by identifying the biases impacting your decision making.

In Behavioral Finance and Your Portfolio, acclaimed investment advisor and author Michael M. Pompian delivers an insightful and thorough guide to countering the negative effect of cognitive and behavioral biases on your financial decisions. You'll learn about the "Big Five" behavioral biases and how they're reducing your returns and leading to unwanted and unnecessary costs in your portfolio.

Designed for investors who are serious about maximizing their gains, in this book you'll discover how to:

_ Take control of your decision-making--even when challenging markets push greed and fear to intolerable levels

_ Reflect on how to make investment decisions using data-backed and substantiated information instead of emotion and bias

_ Counter deep-seated biases like loss aversion, hindsight and overconfidence with self-awareness and hard facts

_ Identify your personal investment psychology profile, which you can use to inform your future financial decision making

Behavioral Finance and Your Portfolio was created for individual investors, but will also earn a place in the libraries of financial advisors, planners and portfolio managers who are determined to counteract the less principled and data-driven aspects of their decision making.

Produktdetails

• Wiley Finance
• Verlag: Wiley / Wiley & Sons
• Artikelnr. des Verlages: 1W119801610
• 1. Auflage
• Seitenzahl: 320
• Erscheinungstermin: 24. Juni 2021
• Englisch
• Abmessung: 163mm x 236mm x 31mm
• Gewicht: 520g
• ISBN-13: 9781119801610
• ISBN-10: 1119801613
• Artikelnr.: 60690275

Autorenporträt

MICHAEL M. POMPIAN is Founder and Chief Investment Officer of Sunpointe Investments, an investment advisory and wealth management firm based in St. Louis, Missouri. He is the author of five books on finance, including Advising Ultra-Affluent Clients and Family Offices, Behavioral Finance and Wealth Management, and Behavioral Finance and Investor Types.

Inhaltsangabe

Preface xv

Acknowledgments xxi

About the Author xxiii

Part I Introduction To Behavioral Finance 1

Chapter 1: What is Behavioral Finance and Why Does It Matter? 3

Why Behavioral Finance Matters 5

Behavioral Finance: The Big Picture 6

Standard Finance versus Behavioral Finance 15

Chapter 2: Introduction to Behavioral Biases 23

Introduction 23

Behavioral Biases Defined 24

Why Understanding and Identifying Behavioral Biases is Crucial 25

Categorization of Behavioral Biases 27

Differences between Cognitive and Emotional Biases 27

Difference among Cognitive Biases 28

Emotional Biases 29

A Final Word on Biases 31

Part II Belief Perseverance Biases Defined and Illustrated 33

Chapter 3: Belief Perseverance Bias #1: Cognitive Dissonance Bias 35

Bias Description 35

Am I Subject to Cognitive Dissonance Bias? 38

Investment Advice 39

Chapter 4: Belief Perseverance Bias #2: Conservatism Bias 41

Bias Description 41

Am I Subject to Conservatism Bias? 44

Investment Advice 45

Chapter 5: Belief Perseverance Bias #3: Confirmation Bias 47

Bias Description 47

Am I Subject to Confirmation Bias? 51

Investment Advice 52

Chapter 6: Belief Perseverance Bias #4: Representativeness Bias 55

Bias Description 55

Examples of Representativeness Bias 56

Am I Subject to Representativeness Bias? 60

Investment Advice 62

Chapter 7: Belief Perseverance Bias #5: Illusion-of-Control Bias 65

Bias Description 65

Example of Illusion of Control Bias 66

Am I Subject to Illusion of Control Bias? 69

Investment Advice 70

Chapter 8: Belief Perseverance Bias #6: Hindsight Bias 73

Bias Description 73

Example of Hindsight Bias 74

Am I Subject to Hindsight Bias? 76

Investment Advice 77

Part III: Information Processing Biases Defined and Illustrated 79

Chapter 9: Information Processing Bias #1: Mental Accounting Bias 81

Bias Description 81

Practical Application 83

Am I Subject to Mental Accounting Bias? 85

Investment Advice 88

Chapter 10: Information Processing Bias #2: Anchoring Bias 91

Bias Description 91

Example of Anchoring and Bias 92

Am I Subject to Anchoring Bias? 94

Investment Advice 95

Bonus Discussion: Investment Strategies That Leverage Anchoring Bias 96

Chapter 11: Information Processing Bias #3: Framing Bias 99

Bias Description 99

Example of Framing Bias 101

Am I Subject to Framing Bias? 105

Investment Advice 107

Chapter 12: Information Processing Bias #4: Availability Bias 109

Bias Description 109

Example of Availability Bias 110

Am I Subject to Availability Bias? 113

Investment Advice 114

Chapter 13: Information Processing Bias #5: Self-Attribution Bias 117

Bias Description 117

Example of Self-Attribution Bias 118

Am I Subject to Self-Attribution Bias? 119

Investment Advice 121

Chapter 14: Information Processing Bias #6: Outcome Bias 123

Bias Description 123

Am I Subject to Recency Bias? 125

Chapter 15: Information Processing Bias #7: Recency Bias 129

Bias Description 129

Example of Recency Bias 130

Am I Subject to Recency Bias? 134

Investment Advice 135
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