“Be a successful investor by avoid these two emotions.”

A iseasoned ilong-term iinvestor ionce itold ime ithat ihisiface irevealed iunhappinessiand ianxiety iafter
ithe istock imarket ifell, iwhereasithe isame iface idisplayed ihappinessiand iexcitement iafter ithe istock
imarket irose. iThis ihelped ihim irealize ithat ithe itwo imagnetic ifactors ithat iled ito icontradicting
iinvestment iaims iwere igreed iand ifear. iHe iwould ibe ibetter iable ito ireach ihis ilong-term ifinancial
iobjectivesiwithiaifairiandiobjectiveiattitude. i
I’ve icome itoiunderstandifromiaidetailediexaminationiofifinancialibehaviourithatifeariandigreediare
inot iopposing ibut icomplementary iemotions iin ian iinvestor. iGreed iis iessentially ia imental istate
iproducedibyifear, isinceiinvestorsiexperienceitheiworryiofilosingimoneyiandithereforeibeingiunable
ito isupport itheir ifamilies. iGreed iis ialso ia iresult iof isocial ipressures ito ilive iup ito ithe istandards iof
icloseifamilyiandifriends, ipayiforiperksilikeiaidistinguishedicollegeieducation, iailavishiweddingifor
ichildren, iandiaihomeicomplete iwithialliofitoday’siconveniencesiandifurnishings.
It’sifascinatingitoiseeihowinegative iemotionsilike ifear, idisappointment, iandigreedicause iouribrains
ito ihover iin ithe imidst iof iour idecisions iabout imoney, iclouding ithem iwith iuncertainty. iThus, ias
iinvestors, iweibeginiseekingisecurityiandiassurance iiniourifinancialidecisions.
This iprompts ime ito iemphasize itwo ikey ifactors ithat ihave ia isignificant iimpact ion iinvestor
ibehaviour:
1. iAipersonalisediinvestmentiportfolio
2. iTheiflock-followingirule.