Psychological Rule 3: Human Beings Are Inefficient
Psychological reserach over the last 20 years has proven that human beings are very inefficient decision makers. This is because we have so much information to process that we must use shortcut mechanisms to deal with it all. Psychologists call these mechanisms judgmental heuristics and I've documented a lot of them in the new edition of Trade Your Way to Financial Freedom. However, the key to my coaching is help you make yourself as efficient as possible. I think the trend of Behavioral Finance-- to try to predict the market through understanding these inefficiencies.-- is ridiculous.Your job is to make yourself as efficient as possible and you can do that through eliminating mistakes, but that is the topic of rule 4.
Comments
Dear Van,
a happy New Year to you and your family. Looking forward to your ideas to follow.
Kindest regards
Gabriele
Posted by: Gabriele | December 29, 2006 08:01 PM