The Psychology of Financial Professionals and Their Clients
Investments & Wealth Monitor, September-October 2019, pp. 15-20
8 Pages Posted: 18 Oct 2019
Date Written: September 24, 2019
Financial professionals and their clients exhibit a wide collection of behavioral biases that many times result in imperfect judgments and outcomes. Understanding these cognitive and affective factors are important for financial planners and advisors to ensure their clients are receiving the best financial advice and investment information. The authors describe some common psychological biases and offer solutions for overcoming these biases. The paper draws on some themes from the authors’ book Financial Behavior – Players, Services, Products, and Markets published by Oxford University Press in 2017.
Keywords: Investor psychology, personal finance, financial planning, biases, behavioral finance, behavioural finance, financial behavior, behavioral economics, cognitive issues, affect, emotion, belief perseverance, confirmation bias, control, hindsight, framing, mental accounting, familiarity, overconfidence
JEL Classification: A12, D81, G00, G30, G10, M00, M10, M41
Suggested Citation: Suggested Citation