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Behavior and Decision Making
Excellent article concerning decision making and behavior in business or every day life. I follow several boards and forums and see this stuff everyday including the real world...I'm sure we all can benefit to some extent from at least understanding the problems.
Awesome stuff! Why have I not been reading more about behaviorial finance?
I had the thought a little while ago about the chemical aspects of emotion in trading. I'm gonna make my weekly watch-list tomorrow, if I get a few minutes after I'll see if I can't put something together.
So true. Trading sounds so easy in theory, but when push-comes-to-shove almost everthing you read or thought has almost nothing to do with actually trading.
Taken in context with the rest of the article, this paragraph on mental accounting comes across to me as if they're saying the separation of monies is a problem. I see separation of monies as a great idea, cause in my life it means peace of mind. I have 6 accounts I make regular deposits into, and each one is for something different. For example, my deposit of $50 each week into an Auto Expense account ensures that if my van drops it's transmission tomorrow, I can easily pay for the repair without panicking, scrambling, or having to borrow.
