Behavioral Finance and Your Portfolio: A Navigation Guide for Building Wealth 2nd Edition by Michael M. Pompian – Ebook PDF Instant Download/DeliveryISBN: 1119801990, 9781119801993
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Product details:
ISBN-10 : 1119801990
ISBN-13 : 9781119801993
Author : Michael Pompian
Become a more strategic and successful investor by identifying the biases impacting your decision making.
In Behavioral Finance and Your Portfolio, acclaimed investment advisor and author Michael M. Pompian delivers an insightful and thorough guide to countering the negative effect of cognitive and behavioral biases on your financial decisions. You’ll learn about the “Big Five” behavioral biases and how they’re reducing your returns and leading to unwanted and unnecessary costs in your portfolio.
Behavioral Finance and Your Portfolio: A Navigation Guide for Building Wealth 2nd Table of contents:
PART I: INTRODUCTION TO BEHAVIORAL FINANCE
1 What Is Behavioral Finance and Why Does It Matter?
Why Behavioral Finance Matters
Behavioral Finance: The Big Picture
Standard Finance versus Behavioral Finance
Notes
2 Introduction to Behavioral Biases
Introduction
Behavioral Biases Defined
Why Understanding and Identifying Behavioral Biases Is Crucial
Categorization of Behavioral Biases
Differences between Cognitive and Emotional Biases
Difference among Cognitive Biases
Emotional Biases
A Final Word on Biases
PART II: BELIEF PERSEVERANCE BIASES DEFINED AND ILLUSTRATED
3 Belief Perseverance Bias #1: Cognitive Dissonance Bias
Bias Description
Am I Subject to Cognitive Dissonance Bias?
Investment Advice
Note
4 Belief Perseverance Bias #2: Conservatism Bias
Bias Description
Am I Subject to Conservatism Bias?
Investment Advice
Notes
5 Belief Perseverance Bias #3: Confirmation Bias
Bias Description
Am I Subject to Confirmation Bias?
Investment Advice
6 Belief Perseverance Bias #4: Representativeness Bias
Bias Description
Examples of Representativeness Bias
Am I Subject to Representativeness Bias?
Investment Advice
Note
7 Belief Perseverance Bias #5: Illusion-of-Control Bias
Bias Description
Example of Illusion of Control Bias
Am I Subject to Illusion of Control Bias?
Investment Advice
Notes
8 Belief Perseverance Bias #6: Hindsight Bias
Bias Description
Example of Hindsight Bias
Am I Subject to Hindsight Bias?
Investment Advice
PART III: INFORMATION PROCESSING BIASES DEFINED AND ILLUSTRATED
9 Information Processing Bias #1: Mental Accounting Bias
Bias Description
Practical Application
Am I Subject to Mental Accounting Bias?
Investment Advice
Notes
10 Information Processing Bias #2: Anchoring Bias
Bias Description
Example of Anchoring and Bias
Am I Subject to Anchoring Bias?
Investment Advice
Bonus Discussion: Investment Strategies That Leverage Anchoring Bias
11 Information Processing Bias #3: Framing Bias
Bias Description
Example of Framing Bias
Am I Subject to Framing Bias?
Investment Advice
12 Information Processing Bias #4: Availability Bias
Bias Description
Example of Availability Bias
Am I Subject to Availability Bias?
Investment Advice
Notes
13 Information Processing Bias #5: Self-Attribution Bias
Bias Description
Example of Self-Attribution Bias
Am I Subject to Self-Attribution Bias?
Investment Advice
Note
14 Information Processing Bias #6: Outcome Bias
Bias Description
Am I Subject to Recency Bias?
Note
15 Information Processing Bias #7: Recency Bias
Bias Description
Example of Recency Bias
Am I Subject to Recency Bias?
Investment Advice
PART IV: EMOTIONAL BIASES DEFINED AND ILLUSTRATED
16 Emotional Bias #1: Loss Aversion Bias
Bias Description
Example of Loss Aversion Bias
Am I Subject to Loss Aversion Bias?
Investment Advice
Note
17 Emotional Bias #2: Overconfidence Bias
Bias Description
Examples of Overconfidence Bias
Am I Subject to Overconfidence Bias?
Investment Advice
A Final Word on Overconfidence
Notes
18 Emotional Bias #3: Self-Control Bias
Bias Description
Example of Self-Control Bias
Am I Subject to Self-Control Bias?
Investment Advice
Note
19 Emotional Bias #4: Status Quo Bias
Bias Description
Example of Status Quo Bias
Am I Subject to Status Quo Bias?
Investment Advice
Note
20 Emotional Bias #5: Endowment Bias
Bias Description
Example of Endowment Bias
Am I Subject to Endowment Bias?
Investment Advice
Note
21 Emotional Bias #6: Regret Aversion Bias
Bias Description
Example of Regret Bias
Am I Subject to Regret Bias?
Advice
22 Emotional Bias #7: Affinity Bias
Bias Description
Example of Affinity Bias
Am I Subject to Affinity Bias?
Investment Advice
Note
PART V: BEHAVIORAL INVESTOR TYPES
23 Staying on Target to Reach Financial Goals Is Hard
Non-Financial Examples of Self-Defeating Behavior
Financial Examples of Self-Defeating Behavior
Notes
24 Introduction to Behavioral Investor Types
Introduction
What Is My Behavioral Investor Type?
Step 1: BIT Orientation Quiz
Step 2: Bias Identification Quiz
Step 3: Advice for Each BIT
Summary
25 Preserver Behavioral Investor Type
Upside/Downside Analysis
Bias Analysis of Preservers
Advice for Preservers
26 Follower Behavioral Investor Type
Upside/Downside Analysis
Bias Analysis of Followers
Other Important Follower Biases: Hindsight, Cognitive Dissonance, and Regret
Advice for Followers
27 Independent Behavioral Investor Type
Upside/Downside Analysis
Bias Analysis of Independents
Self-Attribution
Conservatism Bias
Representative Bias
Advice for Independents
28 Accumulator Behavioral Investor Type
Upside/Downside Analysis
Accumulator Bias Analysis
Advice for Accumulators
29 Asset Allocation Case Studies for Each Behavioral Investor Type
PART VI: BEHAVIORAL ASPECTS OF PORTFOLIO IMPLEMENTATION
30 Behavioral Finance Aspects of the Active versus Passive Debate
The Logic of Passive Management
The Potential Benefits of Active Management
Advice: Use the Best Practical Allocation for Your Portfolio
Notes
31 Behaviorally Aware Portfolio Construction
Introduction
Goals-Based Investing
Consolidating Accounts into a Portfolio View
Portfolio Approach
32 Behavioral Finance and Market Corrections
The Most Recent Panic
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