Avoiding three common biases in investment decisions

Understanding cognitive biases enables you to stay on top of your financial planning and decision-making, reducing your chances of suffering avoidable losses.
Understanding cognitive biases enables you to stay on top of your financial planning and decision-making, reducing your chances of suffering avoidable losses.PHOTO: ST FILE

SINGAPORE - Getting your finances in order can be hard. Sometimes your emotions derail sound, rational assessment; at other times, you will need to do extensive research to be confident of the decisions you make.

To complicate matters further, humans are also affected by cognitive biases - habits of thinking developed over many years that are hardwired into the brain and can give rise to errors of judgment.

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