Financial psychology is part of the field of behavioral economics, a burgeoning social science first recognized with the award of a Nobel Prize in Economics in 2002 to Daniel Kahneman, and again in 2017 with the prize awarded to Richard Thaler. A practical benefit of behavioral economics is that investors can take assessments to understand their personal financial personality traits. Are you a risk taker? Will you follow through on a long-term plan? These are financial personality traits that behavioral economics helps you identify and manage. With traditional price-to-earnings valuation benchmarks broken and growing concerns about a bubbly market, it’s important to keep the speculative nature of excitement-seekers in check. If you think you may be prone to taking excessive risk, the current economic boom makes it an opportune moment to assess your unique investor personality traits. Please let us know if you would like to take a free personal financial identity assessment. Nothing contained herein is to be considered a solicitation, research material, an investment recommendation, or advice of any kind, and it is subject to change without notice. Any investments or strategies referenced herein do not take into account the investment objectives, financial situation or particular needs of any specific person. Product suitability must be independently determined for each individual investor. Tax advice always depends on your particular personal situation and preferences. You should consult the appropriate financial professional regarding your specific circumstances. The material represents an assessment of financial, economic and tax law at a specific point in time and is not intended to be a forecast of future events or a guarantee of future results. Forward-looking statements are subject to certain risks and uncertainties. Actual results, performance, or achievements may differ materially from those expressed or implied. Information is based on data gathered from what we believe are reliable sources. It is not guaranteed as to accuracy, does not purport to be complete, and is not intended to be used as a primary basis for investment decisions. This article was written by a professional financial journalist for Advisor Products and is not intended as legal or investment advice. |