Book Review: The Laws of Wealth
How do our own behaviours get in the way of us making superior investment decisions? Behavioural psychology has much to teach us on this topic and it gets explored here, in The Laws Of Wealth by Daniel Crosby
Book Summary Notes: The Laws Of Wealth – Daniel Crosby
- Know your limitations to help you make better decisions about your investments. All of us will tend towards over estimating our ability both in life and in investing. An overconfidence bias, such as this, can be devastating to our financial lives.
- Emotions are another trigger that can greatly impact our investment decisions and we need to keep this in mind as we move along our investing journey.
- A great investing choice can be to work with an advisor, but not for the reasons you think. An advisor can help give you a second opinion on your investment choices and keep you from making catastrophic decisions on a whim.
- The media likes to blow out any and all movements in the share market so be prepared for your investments to move around and don’t let it worry or concern you.
- Never invest in a ‘hot pick’ it doesn’t matter who is giving you the info, if it doesn’t fit your investment strategy don’t let it tempt you to stray. It can be difficult though and so often the easiest way to avoid these mistakes is to not take the advice in the first place. Avoid talking about your friends hot pick when you chat, focus on something else instead.
