This post originally appeared onLearnVest.
Fall, curiously, has never been viewed as a great season for investing.
Meanwhile, the biggest stock market crashesBlack Tuesday in 1929 and Black Monday in 1987both took place in October.
Also remember that generally speaking, what goes up will eventually go down when it comes to the markets.
Twenty-year returns, however, have never fallen into the red.
Then you may have fallen victim to the sunk-cost fallacy.
This is when people make a run at avoid losses because they feel too painful.
However, any investment in your portfolio that is not ultimately going to help you should probably be offloaded.
Overconfidence Effect
How It Tricks Us:There’s nothing wrong with a little self-confidence.
But it left you convinced that you were a star-in-the-making.
“There is no silver bullet.”
“What do they see as the impact on their life, on their relationships?”
Confirmation Bias
How It Tricks Us:It’s a basic human flaw.
The researchers found that people spent 36% more time reading an essay if it supported their personal beliefs.
“), while ignoring the bad (“Revenue is way down!").
“That might mean something like setting up a $100 automatic monthly deposit into an investment account.
Then, in a year, we’ll take a look to see how they feel about it.”
After all, it may be what led you to find a fulfilling career or make good business decisions.
So see to it you do the research and choose one that fits your overall goals.
Blaylock points to the recent IPO of Chinese e-commerce company Alibaba, which generated a great deal of buzz. "
How to Outsmart It:Tune out the noise.
In fact, if you’re jumping on an investing bandwagon, you might be contributing to bigger problems.
Some market watchers blamethe bandwagon effectfor the big downward slide of some non-stock assets in 2008.
Negativity Bias
How It Tricks Us:We all hate hearing bad news.
“That’s why you see markets react so quickly on bad news,” Blaylock says.
“But when good news happens, you just hear, ‘Well, the market may go up.’
A lot of times, the reaction to negative news is just overreaction.”
How to Outsmart It:Stick to your game plan.
Translation: Remember that you’re in it for the long haul.
“It’s inherently unpredictable and too complex.”
Information shown is for illustrative purposes only and is not intended as investment, legal or tax planning advice.
c’mon consult a financial adviser, attorney or tax specialist for advice specific to your financial situation.
Image adapted fromAdrian Niederhaeuserandkraphix(Shutterstock).
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