Market Cycles: How Advisors Can Protect Investors From Themselves

It’s well documented that most people underperform the market. By fleeing at when times are tough and re-investing after a recovery is nearly finished, too many people sell low and buy high, leaving a few people willing to do the opposite – or just hold tight across market cycles – to reap excess rewards.

“One of the greatest services a financial advisor can provide to clients is helping to ensure that in times of market turbulence, reason, discipline, and objectivity triumph over emotions such as fear, greed, and regret,” writes Gregg S Fisher, the chief investment officer at Gerstein Fisher in Advising the Behavioral Investor: Lessons from the Real World.

Since that’s easier said than done when people are in...