Practical analysis for investment professionals
12 April 2013

Weekend Reads for Financial Advisors: Brains, Behavioral Biases, and Bitcoins (and Taxes)

When last did you think about your brain? An odd question, perhaps. But given that this is the organ that controls thought, memory, emotion, touch, motor skills, vision, respirations, temperature, hunger, and every process that regulates our body, we spend surprisingly little time noodling over our gray matter.

Recently I’ve been thinking more about my brain. What got me started was an excerpt on “fear” from Jason Zweig’s book Your Money and Your Brain. My colleague Jason Voss, CFA, also wrote a blog post about this chapter: “Overcoming Anxiety Is Key to Investment Success” and Joe Nocera of the New York Times did a terrific column on the themes of the book: “Can We Turn Off Our Emotions When Investing?” It turns out “the brain is not an optimal tool for making financial decisions,” because the part of our brain that tells us to act like rational investors tends to be overtaken by more powerful emotional impulses. This has profound implications for investing behavior and financial decision-making.

So, with that in mind, here are some articles and/or resources that may be of interest, beginning with a few on behavioral finance.

Behavioral Finance/Neuroscience

Investing

Practice Management / Firm Dynamics

  • At your workplace, are you a giver, a taker, or a matcher? If you’re a giver, chances are you will be the one most likely to get ahead, according to the article “Is Giving the Secret to Getting Ahead?” The piece explores the work of organizational psychologist Adam Grant, author of the recently published book Give and Take: A Revolutionary Approach to Success, which “incorporates scores of studies and personal case histories that suggest the benefits of an attitude of extreme giving at work.” (New York Times Magazine)

Bitcoins

Eldercare

Taxes/Budget for Fiscal Year 2014

And Now For Something Completely Different


Please note that the content of this site should not be construed as investment advice, nor do the opinions expressed necessarily reflect the views of CFA Institute.

Photo credit: ©iStockphoto.com/JLGutierrez

About the Author(s)
Lauren Foster

Lauren Foster is managing editor of Enterprising Investor and co-lead of CFA Institute’s Women in Investment Management initiative. Previously, she worked as a freelance writer for Barron’s and the Financial Times. Prior to her freelance work, Foster spent nearly a decade on staff at the FT as a reporter and editor based in the New York bureau. Foster holds a BA in political science from the University of Cape Town, and an MS in journalism from Columbia University.

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