When it comes to investing, your brain can be your best friend or your worst enemy. My guest today explains how, and what you can do to ensure your brain is a staunch ally in your quest for financial security. His name is Daniel Crosby, he’s a psychologist, behavioral finance expert, and the author of The Behavioral Investor. We begin our conversation discussing the surprising ways sociology and physiology influence our financial decisions. We then delve into the psychological factors that cause us to make bad investing decisions, including ego, conservatism, attention, and emotion. Daniel then walks us through ways you can mitigate those factors in your financial choices. We end our discussion outlining what an investing framework looks like based on principles of behavioral science.
While the principles discussed in this show relate to making sound choices in the area of financial investing, they’re really relevant to making good decisions of every kind.
- What is behavioral investing?
- How sociological principles impact our financial decision-making
- Why money is a “functional fiction”
- How our body and physical well-being influences our financial decisions
- Testosterone and financial decisions (and why women are better investors)
- How ego affects investing
- Why our confidence increases when more complexity is introduced
- What is conservatism?
- How loss aversion impacts our decision making
- Why you should sleep on it
- How our attention influences our decisions
- Why you shouldn’t be checking your portfolio every day
- The HALT Tool
- What type of person should get a financial advisor?
Resources/People/Articles Mentioned in Podcast
- My first interview with Daniel about the laws of wealth
- How Adam Smith Can Change Your Life
- Sapiens by Yuval Noah Harari
- The Great Beanie Baby Bubble
- The Hour Between Dog and Wolf
- AoM series on testosterone
- Ego Is the Enemy
- Think Like a Poker Player to Make Better Decisions
- How to Think About Money
- Is There Any Reason to Keep Up With the News?
Connect With Daniel
Listen to the Podcast! (And don’t forget to leave us a review!)
Recorded on ClearCast.io
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Read the Transcript
The post Podcast #511: Mastering the Psychology of Investing appeared first on The Art of Manliness.