Category: Behavioral Tales

THE FINANCIAL ADVICE I WISH I’D KNOWN THEN

THE FINANCIAL ADVICE I WISH I’D KNOWN THEN

One of my favorite musicians is Bob Seger. I saw him perform live while in college and he left a lasting impression. The first time I heard the song “Against the Wind” I was living in Seger’s hometown of Detroit, and the song only elevated his status. I think it is brilliant; containing one of […]

AN ABSOLUTE TALE: THE WEALTH INFLECTION POINT (WIP)

AN ABSOLUTE TALE: THE WEALTH INFLECTION POINT (WIP)

I wrote this tale due to a particular event.  It made me stop and reflect on what matters when it comes to managing money.  It changed the way I managed portfolios for most people.  It happened in October 2002.  This tale primarily provides us with insight on human behavior under financial adversity.  It also touches […]

HOW DO I ALLOCATE MY MONEY ONCE I START SAVING? A TALE OF TWO TITANS

HOW DO I ALLOCATE MY MONEY ONCE I START SAVING? A TALE OF TWO TITANS

A question that always comes up, regardless of age, is how do I allocate my money once I start a savings program? The question soon morphs into how do I allocate my money after I have been saving for some time? I believe in simplicity. The combination of simplicity with mathematical elegance leads to a […]

A TALE OF HINDSIGHT: “IT’S NOT 20/20”

A TALE OF HINDSIGHT: “IT’S NOT 20/20”

They say that hindsight is 20/20.  This means that you can see perfectly when looking backwards.  If looking backwards made you wealthy then historians would be the richest people in the world.  They’re not.  To create wealth you must look forward.  I like to think that the past is like reading the rulebook for the […]

A TALE OF DESTRUCTION: “SUCCESS BREEDS FAILURE – THE PLIGHT OF THE SUCCESSFUL MONEY MANAGER”

A TALE OF DESTRUCTION: “SUCCESS BREEDS FAILURE – THE PLIGHT OF THE SUCCESSFUL MONEY MANAGER”

This tale is a Behavioral Tale because primarily it demonstrates the pitfalls of what behaviorists call the group mentality or the herd mentality. It also teaches that past performance is not an indication of future performance and investors must know how it is your Hired Asset Manager or HAM generates the types of returns they do. To succeed investors […]

WHY BEHAVIORAL FINANCE MATTERS: A PARTY TALE

WHY BEHAVIORAL FINANCE MATTERS: A PARTY TALE

One of my favorite life lessons centers around President Franklin Delano Roosevelt, also known as FDR.  FDR had many strengths but I think his greatest was his ability to recognize that things are not always black and white.  I think his ability to see the big picture as well as discern the subtleties of a situation […]

DUNBAR’S NUMBER AND ADVISORY RELATIONSHIPS: A MONKEY TALE

DUNBAR’S NUMBER AND ADVISORY RELATIONSHIPS: A MONKEY TALE

Tell me if you think this is rude. I get to the first tee and meet my playing partner. It’s just him and me playing golf for 18 holes. We are perfect strangers. He shakes my hand, but doesn’t give his name. So, I do the same. I figure, why not? We spend the next […]

A 500 POINT TALE

A 500 POINT TALE

“We interrupt our regularly scheduled release with a breaking news Tale bulletin. Due to the recent events I think you might gain some perspective from this tale.” “Drop A Zero From The Dow” As the market closed down today, August 10, 2011, roughly 520 points I was somehow transported to a different place and time.  […]

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