PA’s armchair critic Brendan Llewellan looks at the biases that exist in retail investment and asks how advisers can tackle them for the good of their clients
This is one of the longest-running, hottest topics in retail investments. The range of biases investors shoulder makes you wonder how anyone ever achieves a decent return. For me though, the interesting question lies in the dynamic between investment products, financial advice and the investor. I'd go as far as to say that apart from the obvious benefits of expertise and experience the point of engaging an adviser is that he or she will be able to make recommendations to help overcome any biases I might have. Let's just look at two well-known biases - confirmation bias and loss ave...
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