How many times do we have a certain mandate, only to switch to something else when we hear of a good idea from a magazine, a friend or the news?

Contrary to the beliefs of some investors, dramatic changes in security prices are not a sign that the financial system is broken but rather what we would expect to see if markets are working properly.

Understanding potential flaws in your thinking will make you more aware of how these may affect your investing behaviour.

Our brain’s threat centre always gives priority to bad news. Why is this so? And how does this relate to risk aversion in investing?