Ben Graham on Avoiding Self-Destructive Investor Behavior

Ben Graham on Avoiding Self-Destructive Investor Behavior
CC Investment Masters Class - with permission

Individuals who cannot master their emotions are ill-suited to profit  from the investment process.” Ben Graham Father of Value Investing

Ben Graham on Avoiding Self-Destructive Investor Behavior

A study by Dalbar underscores the importance of controlling emotions and avoiding self-destructive investor behavior. From 1992–2011, the average stock fund returned 8.2% annually while the average stock fund investor earned only 3.5%. We call the gap between these results the “investor behavior penalty.” Why have investors historically sacrificed more than half their potential return? Driven by emotions like fear and greed, they succumbed to negative behavior such as:

ValueWalk’s December 2021 Hedge Fund Newsletter: Hedge Funds Avoid Distressed China Debt

InvestWelcome to our latest issue of issue of ValueWalk’s hedge fund update. Below subscribers can find an excerpt in text and the full issue in PDF format. Please send us your feedback! Featuring hedge funds avoiding distressed china debt, growth in crypto fund launches, and the adapting venture capital industry. Q3 2021 hedge fund letters, Read More

• Pouring money into the latest top-performing manager or asset class, expecting the winning streak= to continue

• Avoiding areas of the market that have performed poorly, assuming recovery will never occur

• Abandoning their investment plan by attempting to successfully time moves in and out of the market, a near impossible feat

Successful investors throughout history have understood that building long-term wealth requires the ability to control emotions and avoid self destructive investor behavior.

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