Keep it simple to ride out market emotions

In his latest article, Robin Bowerman of Vanguard Investments Australia suggests: “There is one clear lesson investors can learn from the recent sharemarket turmoil – the smart way to invest is to keep things simple.”

It is an excellent article that discusses behavioural finance and draws on research from Steve Utkus, the head of Vanguard’s US Centre for Retirement Research. You can read the full article here. Be sure to read the closing paragraphs suggesting strategies for guarding against overconfidence.

You can also watch an interview with Steve Utkus here. If you are already familiar with the context of behavioural finance then I recommend you skip to question 7 in the video.