What Investors Really Want:
We want it all in investing, and everywhere in life beyond it. We want to be thin yet enjoy the delicious food that makes us fat. We want to spend everything now and still have it in retirement.
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The financial services industry does not always present the tradeoffs. They regularly imply that we can have it all ... But, more often than not, we can't.
Portfolioist: You outline three benefits of investing, and the tradeoffs among them. Can you explain?
Statman: The benefits are utilitarian, expressive, and emotional.
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Private banking expresses status and esteem. A stock picker says, "I am smart, able to pick winning stocks." An options trader says, "I'm sophisticated, willing to take risk and knowing how to control it."
Emotional benefits are the answer to the question, "How does it make me feel?" Insurance policies make us feel safe, lottery tickets and speculative stocks give us hope, and stock trading is exciting.
http://www.stuff.co.nz/business/mone...rs-really-want
We want it all in investing, and everywhere in life beyond it. We want to be thin yet enjoy the delicious food that makes us fat. We want to spend everything now and still have it in retirement.
.......................
The financial services industry does not always present the tradeoffs. They regularly imply that we can have it all ... But, more often than not, we can't.
Portfolioist: You outline three benefits of investing, and the tradeoffs among them. Can you explain?
Statman: The benefits are utilitarian, expressive, and emotional.
...............................
Private banking expresses status and esteem. A stock picker says, "I am smart, able to pick winning stocks." An options trader says, "I'm sophisticated, willing to take risk and knowing how to control it."
Emotional benefits are the answer to the question, "How does it make me feel?" Insurance policies make us feel safe, lottery tickets and speculative stocks give us hope, and stock trading is exciting.
http://www.stuff.co.nz/business/mone...rs-really-want
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