TestenGOLD- Free

When you allow emotions to sway your investment declslons

The Straits Times|October 27, 2024
Financial experts caution against Fomo and greed; say think long term and manage risks
- Alyssa Woo
When you allow emotions to sway your investment declslons

Investing and financial markets might be full of data, graphs and analyses, but one thing they do not chart is how much of it could have been driven by emotional investors.

We are inherently emotional beings, after all, and we cannot stop feelings from happening. What we can try to do is prevent our emotions and psychological behaviours from influencing us into making a bad investment decision - firstly, by being aware of how we are feeling, and then going through some mental checks before acting on it in the market.

Unfortunately, most people are either unaware of making emotional investment decisions or are in denial, so they do at times fall into a trap.

"They can't face the reality when they sell their investment and the loss is materialised, because the emotional pain they experience is greater," said Mr Aaron Chwee, head of wealth advisory at OCBC Bank.

Investors may also experience greed and overconfidence.

So what are the biggest red flags to be wary of?

Fear and greed. That includes the fear of missing out, or Fomo, which is a pretty common emotion experienced by many, Mr Chwee added.

When one pays attention to market chatter and to what friends are buying, it could give the impression that a certain company or stock is popular or a good one to invest in. This could lead to irrational decisions and taking excessive risk without doing adequate research.

Take, for example, the meme stock bubble of 2021, when some stocks such as Game Stop surged more than 1,000 per cent, and later petered out. A meme stock is one that sees dramatic price increases due to social media sentiments.

"We've seen this happening in China recently, with young people. After a series of government stimulus had been rolled out, they took out loans to buy Chinese equities, and had no idea how to service the loans," said Mr Chwee.

Diese Geschichte stammt aus der October 27, 2024-Ausgabe von The Straits Times.

Starten Sie Ihre 7-tägige kostenlose Testversion von Magzter GOLD, um auf Tausende kuratierte Premium-Storys sowie über 9.500 Zeitschriften und Zeitungen zuzugreifen.

Diese Geschichte stammt aus der October 27, 2024-Ausgabe von The Straits Times.

Starten Sie Ihre 7-tägige kostenlose Testversion von Magzter GOLD, um auf Tausende kuratierte Premium-Storys sowie über 9.500 Zeitschriften und Zeitungen zuzugreifen.

WEITERE ARTIKEL AUS THE STRAITS TIMESAlle anzeigen
A-ha frontman Morten Harket has Parkinson's disease
The Straits Times

A-ha frontman Morten Harket has Parkinson's disease

Morten Harket, the lead singer of Norwegian pop band A-ha, whose single \"Take On Me\" (1985) remains one of the most popular songs from the 1980s, said on June 4 that he had been diagnosed with Parkinson's disease.

time-read
2 Minuten  |
June 06, 2025
The Straits Times

$52k clinic • Investor interests shouldn't distort healthcare landscape

I was dismayed – like Health Minister Ong Ye Kung – to read about the $52,000 monthly bid for a clinic space. (Ong Ye Kung ‘dismayed’ at $52k bid to rent Tampines HDB clinic, June 4)

time-read
1 min  |
June 06, 2025
Pistorius a triathlete 12 years after killing partner
The Straits Times

Pistorius a triathlete 12 years after killing partner

South African former Paralympic star Oscar Pistorius was spotted taking part in a triathlon last weekend in the coastal city of Durban, 12 years after murdering his girlfriend Reeva Steenkamp in a crime that drew worldwide attention.

time-read
2 Minuten  |
June 06, 2025
The Straits Times

Chipmaker STMicro expects to shed 5,000 jobs in next 3 years

STMicroelectronics expects 5,000 staff to leave the company in the next three years, including 2,800 job cuts announced earlier in 2025, its chief executive Jean-Marc Chery said on June 4.

time-read
1 min  |
June 06, 2025
Coolmore Banks On Delacroix At Epsom
The Straits Times

Coolmore Banks On Delacroix At Epsom

Trainer O'Brien, however, does not rule out The Lion In Winter in his bid for 11th Derby

time-read
3 Minuten  |
June 06, 2025
GrabCab to Launch in July With 40 Toyota Prius Taxis for a Start
The Straits Times

GrabCab to Launch in July With 40 Toyota Prius Taxis for a Start

It will add more models to fleet, including fully electric vehicle some time in 2025

time-read
3 Minuten  |
June 06, 2025
The Straits Times

Asiad to Have Floating Village

Accommodation for Aichi-Nagoya Games includes a cruise liner, shipping containers

time-read
2 Minuten  |
June 06, 2025
3 weeks' jail for married couple who smuggled dogs from Malaysia
The Straits Times

3 weeks' jail for married couple who smuggled dogs from Malaysia

A married couple who smuggled a Pomeranian and a dachshund across the Causeway for a quick buck have been jailed.

time-read
2 Minuten  |
June 06, 2025
The Straits Times

Israeli PM Says Bodies of Two Hostages Retrieved From Gaza

The bodies of two Israeli-Americans killed by Palestinian militants in their Oct 7, 2023 attack and held in Gaza have been returned to Israel, said Prime Minister Benjamin Netanyahu on June 5.

time-read
2 Minuten  |
June 06, 2025
Ikhsan's Double Boosts Confidence
The Straits Times

Ikhsan's Double Boosts Confidence

3-1 win over Maldives is Singapore's first in 7 games but Ogura annoyed with last 30min

time-read
3 Minuten  |
June 06, 2025

Wir verwenden Cookies, um unsere Dienste bereitzustellen und zu verbessern. Durch die Nutzung unserer Website stimmen Sie zu, dass die Cookies gesetzt werden. Learn more