Michael Mauboussin: Four Common Investor Biases

When it comes to achieving personal financial goals, you are your own worst enemy. Investors are always held back by common investor biases, which influence decisions and long-term goals.

[timeless]

Both neuroscientists and psychologists have looked into these biases. Combined the two fields of science have established a field of neuroeconomics to understand better how the human brain decodes economic decisions.

One of the goals of neuroeconomics is to understand how certain behaviors are linked to specific brain activity.

In a report published at the beginning of this week, Michael Mauboussin and Dan Callahan, CFA, looked at four key investor biases, which cause investors to make poor choices. In each case, Mauboussin and his colleague looked at what caused the brain to make...