Investment Psychology



These people are very confident about themselves, whether it is with their career, health or money. They have no hesitation to spring into action and bet it all once their minds are made up. This type of personality can be found in most entrepreneurs. As investors, they like to be their own boss and call the shots. They are not afraid to invest in high risk investments and placing of bets.


These people are constantly on the move, always yearn for activities. However, always looking for activities as they do not have the confidence to go their own way and defy the norm. This type of investors are typically trend followers. They will feel more comfortable by going with the flow and afraid of being left behind, prior to any sharp fall in the stock market, majority of investors belonged to this group. Their nature made these investors best prey to turnover maximizing stock brokers.


Individualists are people who have high self-esteem and at the same time make decisions prudently. These people have no problem of doing things that deviate from the crowd. In investment world, individualists are often contrarians. Although their characteristics do not prohibit them from making wrong investment decisions, the rational thinking and thoughtful nature possessed by these investors help them to stay away from rash bets.


p13These people are very anxious with their money and they do not easily trust the opinions given by other people. In terms of investments, only the safest things or those that offer a guaranteed return will satisfy them. They are broadly called conservative investors. These investors generally have low tolerance for risk. Their profile best resembles that of bond investors.

Straight Arrow

These people are the average investors who do not have a very strong opinion about things and are not particularly keen to take immediate action. These people are willing to listen to expert advice and usually have medium risk preference. Now that you have learnt the kind of investors that you are, the next step in determining your portfolio is to objectively outline your requirement on investment returns, the length of time you are willing to stick to the investments, and your liquidity needs.