Tag: behavioral-finance

I happen to share a trainer with a local advisor. I hadn’t seen him since early 2022, so when I saw him recently, I asked him how his clients responded to the minting of a bear market in U.S. equities.

He shared that he was satisfied with the planning and preparation he had done with his clients because it yielded constructive dialogue and (mostly) content clients. However, he did join me in lamenting over the change in how many clients evaluate success during a bear market versus a bull.

We joked about how, when things are going well, the phone doesn’t ring and clients are fine with the occasional update in percentage terms. On the flip side, when markets decline, clients suddenly become very attuned and only want to know how many dollars they have lost. In short, the benchmark to which a client compares performance changes.

How many times have you stopped and considered the real meaning of words used every day? More importantly, how often do you challenge your own notion of that meaning by looking it up?

Recently I heard a friend and father I respect tell his son that discipline is more important than motivation. He said, “Motivation can come and go, but discipline will take you where you must go, even when you are not feeling very motivated.” It was compelling enough to me that I jotted his words down and started thinking about the meaning of those words – and also their implications.

My mother has always been a big fan of Victor Fleming’s "The Wizard of Oz." When I was a kid, it would be on TV at least once a year, and mom always made a point to watch it. I usually joined her...up until the part where the witch and her creepy troop of flying monkeys showed up. From there I would typically escape somewhere to avoid them, until they returned later that night to rule in my nightmares...

The characters are all memorable due to some of the basic themes they represent, but my favorite is The Scarecrow. He values a brain over anything else and, in an ironic twist, he turns out to be the wisest of the group.

A recent running of the classic, combined with our collective enjoyment in slaying investment industry sacred cows, has me thinking about another famous strawman: the best 10 days rule.

A friend recently convinced me to watch a new(ish) Netflix documentary, “14 Peaks: Nothing is Impossible.” It follows a Nepalese mountaineer who attempts to climb all 14 of the world’s peaks higher than 8,000 meters in less than seven months.

Don’t ask me why I know this, but there’s an episode of “Sex and the City” when the women discuss dating people who “look good on paper.” They explain that a “good on paper guy” is someone who offers great credentials, good manners, and financial stability. He seems like a great match – but only on paper, because in the real world the chemistry simply isn’t right.