Looking at the central role emotion and uncertainty play in financial decision-making and behaviour for finance professionals and the wider public
Can understanding the psychology of investment behaviour help you outperform the market? Probably not, but it can certainly help reduce the probability that you will under-perform the market. This matters, because the majority of private investors under-perform. One compelling piece of research evidence comes from a careful analysis, carried out by Dalbar research, of the… Continue reading Investment, Emotions and the Temple at Delphi*
https://www.youtube.com/watch?v=8LnsfdCIHlA Mark Fenton-O'Creevy and David Jones of IG Index discuss emotions and trading at the London Stock Exchange
Marketers need to understand such consumer behavior in order to formulate appropriate marketing strategy, allocate marketing budget below-the-line and design effective marketing tactics…… In such instances the acts may be normatively positive and leave the shopper feeling good Bayley and Nancarrow 1998: 99 And I am a weapon of massive consumptionAnd it's not my fault… Continue reading Shopping, impulsiveness and weapons of massive consumption
It is common to contrast emotions with rationality (usually in tandem with proclaiming the superiority of reason over emotion). Take for example this post on the changingminds blog. It is also the claim at the heart of Ayn Rand's morally barren apologia for the extremes of modern capitalism, 'Atlas Shrugged'. In this book she claims… Continue reading On the false contrast between rationality and emotion
Money fractures marriages, drives wars, inspires art, motivates some people to great achievements, leads others to despair. Fear, desire, love, hate, jealousy, anger, anxiety, relief, shame and many more shades of emotion may attach to money in the course of an ordinary day. (Photo credit: @Doug88888)Yet, economic accounts of human financial behaviour focus on reasoned… Continue reading Welcome to the emotional finance blog
Emotional Finance 