Investors' Worst Enemy in 2021 Could Be Their Own Brains

Hindsight bias, recency bias and sunk cost fallacy are just three of several cognitive biases that investors need to overcome to achieve their financial objectives this year. To beat these biases, take your emotions out of the mix.

A chalkboard drawing of a man's brain with a dollar sign in it.
(Image credit: Getty Images)

By most measures, 2019 was a very strong year for investors. Whether you invested in domestic or international companies, large or small capitalization stocks, or in most areas of the bond market, the past year’s market performance has been attractive across the board. While such a strong year is cause for exuberance among investors, it’s also important to understand that these experiences can have a serious impact on one’s future decisions in the form of cognitive biases.

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Jonathan I. Shenkman, AIF®
President and Chief Investment Officer, ParkBridge Wealth Management

Jonathan I. Shenkman, AIF®, is the President and Chief Investment Officer of ParkBridge Wealth Management and serves as a financial adviser and portfolio manager for his clients. In this role, he acts in a fiduciary capacity to help his clients achieve their financial goals.