At some point in our lives, I think we’ve all been guilty of following the footsteps of others even when it may not be in our own best interest. This same process of decision making is ever-prevalent in the investment industry. Unfortunately, the wisdom of a crowd often leads to money pouring into investments at a precarious time and creates the infamous “bubble.” Once this bubble reaches a peak, it bursts, and leaves a resonating shockwave throughout the industry. We all remember the dot.com and housing bubbles of the early 2000’s, and despite what we’ve learned from these scenarios, history dictates that this same form of investor psychology will continue to prevail in years to come.
Our partners at Franklin Templeton have put together a video and article that highlights this fascinating piece of investor psychology using a famous historical analogy (involving tulip bulbs no less!). The video and accompanying article further solidify the belief that we have here at CH Financial – the belief that each investment decision needs to be made with individual circumstances in mind. It’s using this approach that we tailor our personalized and holistic investment decisions. We rely on the wisdom and experience of our advisory team, rather than that of the herd.
Max Leveillee, Licensed Associate
& Your CH Financial Team