Behavioral Risks

In Carl Richard’s book, The Behavior Gap, he explains that, “It’s not that we’re dumb. We’re wired to avoid pain and pursue pleasure and security. It feels right to sell when everyone around us is scared and buy when everyone feels great. It may feel right—but it’s not rational.”

The behavior gap is the distance between what we should do and what we actually do.

Links to behavioral risk articles:

1) Why Behavioral Finance?

2) Understanding Risk Appetite

3) Behavioral Finance vs. Traditional Finance Theory

4) Economic Decision Making

5) Confirmation Bias

6) Conservatism Bias

Source(s): Carl Richards


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