The ego of the “Investor” causes investment failure.

Many of you are familiar with the saying, “I know this, I know this.” Ego-driven investors hate investment losses because they are the result of their own mistakes in decision-making. Let’s take a look at the biases that ego investors face and how to deal with them.

The ego of investors in the market

Unable to control oneself or Difficult to control yourself (Self-Control Bias) even though investors set long-term investment goals For the investment portfolio of this group of investors, they will invest in dividend stocks. To bring money to spend for short-term happiness or invest in funds that pay dividends so you can use the dividends to buy happiness first. Even though stocks or funds that do not pay dividends have better long-term returns.

The feeling of loss is greater than victory (Loss Aversion).

On average We feel more losses than wins (Loss Aversion). It’s a textbook saying, “Don’t sell, don’t lose.” This bias prevents investors from selling unprofitable stocks. because of fear of loss It seems that the stock shows no signs of going back up. But investors are willing to hold stocks until the price returns. On the other hand, when stocks go up Investors with this bias will rush to sell stocks. Because of fear that the stock market will go down It limits investors’ profits. Instead, investors should limit their losses. and increase the opportunity to make a profit .

The stock market did not perform as expected. You have to find reasons that make you feel comfortable (Cognitive Dissonance).

What investors face is when they receive new information about the market or stock. that it was inconsistent with my own understanding Traditional investment attitudes, emotions, beliefs, or values that we believe in cause discomfort. Dilemma And this forces us to find reasons to reduce that unpleasant feeling (Cognitive Dissonance).

Already know that it must be like this (Hindsight Bias)

We feel like we already know what it should be like. But in reality Events are unpredictable. Investors who have this bias when stocks fall will say, “Historical Bias” “says this stock must go down It’s a shame it didn’t sell first. Investors overestimate the market’s predictability. In other words, they underestimate the uncertainty of the market.

Staying the same, doing the same old is still good (Status Quo Bias).

Investors choose to hold stocks that they know or are involved with because they don’t want change (Quo Bias). Human nature is inert. This means that everything that already exists isn’t always so bad that you don’t want to change anything.

Don’t want to get hurt from making a wrong decision.

This bias arises because we don’t want to be hurt by our actions or decisions. Things that are caused by our own decisions will hurt us twice as much. Until causing investors to decide to hold low-risk assets and hold them for a long time because they don’t want to feel bad from making another wrong decision.

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Disclaimer: Investing is risky. Investors should study the information before making investment decisions.

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