It’s human nature, that when making decisions, we quite often believe or trust our memory of past experiences, rather than the more obvious facts in front of us.
Traditional economics informed us that; people behaved in a rational manner, financial markets were perfectly normal and accordingly, investors acted rationally.
Have you ever felt swayed when making a decision? Or answered the same question differently on separate occasions simply because of the way that question was posed? Well, if so, you’ve just experienced the power of Framing!
Did you know that the average person hates losing roughly twice as much as they get satisfaction from making the same or equivalent amount of a gain? A well-known experiment carried out by Kahneman and Tversky involved asking people if they would accept a bet based on the flip of a coin.
When making decisions, there is a rule of thumb that describes human tendency to rely too heavily on the first piece of information or number offered. It’s called the “anchor”.
Did you know that almost 90% of all drivers think that they are better than average (Swedish Psychology Journal, Acta Psychologica, Aug 24, 2011). A similar figure applies to the anticipated success of new business start-ups.
Hi, I’m Paul, a Certified Financial Planner from Co. Mayo. I’m married with 5 grown-up children, 2 living abroad and 3 still in college and believe it or not, I’m still alive!