Intro -- Behavioral Finance and Investor Types: Managing Behavior to Make Better Investment Decisions -- Contents -- Foreword -- Preface -- AN IMPERFECT SCIENCE -- WHY THIS BOOK? -- PLAN OF THE BOOK -- WHO SHOULD USE THIS BOOK? -- WHEN TO USE THIS BOOK -- Acknowledgments -- PART One Introduction to Behavioral Finance -- Chapter 1 Why Reaching Financial Goals Is Difficult -- NONFINANCIAL EXAMPLES OF SELF-DEFEATING BEHAVIOR -- Example 1: The Yo-Yo Dieter -- Example 2: The Educated Smoker -- FINANCIAL EXAMPLES OF SELF-DEFEATING BEHAVIOR -- Number 1: The Return Chaser -- Number 2: The Overconfident Gambler -- Number 3: The "Too Conservative" Investor -- SUMMARY -- NOTES -- Chapter 2 Overview of Behavioral Finance -- BEHAVIORAL FINANCE: MICRO VERSUS MACRO -- STANDARD FINANCE VERSUS BEHAVIORAL FINANCE -- Efficient Markets versus Irrational Markets -- Rational Economic Man versus Behaviorally Biased Man -- THE ROLE OF BEHAVIORAL FINANCE WITH PRIVATE CLIENTS -- PRACTICAL APPLICATIONS -- Formulating Financial Goals -- Maintaining a Consistent Approach -- Delivering What the Client Expects -- Ensuring Mutual Benefits -- NOTES -- Chapter 3 The Building Blocks: Behavioral Biases -- COGNITIVE BIASES -- Belief Perseverance Biases -- Information Processing Biases -- EMOTIONAL BIASES -- Loss-Aversion Bias -- Overconfidence Bias -- Self-Control Bias -- Status Quo Bias -- Endowment Bias -- Regret-Aversion Bias -- Affinity Bias -- SUMMARY -- NOTES -- PART Two Personality Theory -- Chapter 4 Introduction to Personality Theory -- HISTORY OF PERSONALITY THEORY -- FOUR MAIN PERSONALITY THEORIES -- Trait-Based Theory -- Behavioral Theory -- Humanist Theory -- Psychodynamic Theory -- NOTES -- Chapter 5 The History of Personality Testing -- TYPES OF PERSONALITY TESTS -- Woodsworth Personal Data Sheet -- Edwards Personality Inventory -- Myers-Briggs Type Indicator.

Eysenck Personality Questionnaire -- Minnesota Multiphasic Personality Inventory -- Cattell's 16PF -- The Five-Factor Model and the Revised NEO Personality Inventory -- SUMMARY -- NOTES -- Chapter 6 The Behavioral Investor Type Framework -- REVIEWING THE ORIGINAL PROCESS -- THE BEHAVIORAL ALPHA PROCESS: A TOP-DOWN APPROACH -- Step 1: Identify a Client's Active or Passive Traits -- Step 2: Administer Risk Tolerance Questionnaire -- Step 3: Test for Behavioral Biases -- UPDATES TO THE PREVIOUS MODEL -- UPDATED BIT THEORY AND APPLICATION -- SUMMARY -- Chapter 7 Behavioral Investor Type Diagnostic Testing -- STEP 1: BIT ORIENTATION QUIZ -- STEP 2: BIAS IDENTIFICATION QUIZ -- SUMMARY -- PART Three Explanation of the Behavioral Investor Types -- Chapter 8 The Preserver -- UPSIDE/DOWNSIDE ANALYSIS -- BIAS ANALYSIS -- Loss-Aversion Bias -- Status Quo Bias -- OTHER BIASES -- Endowment Bias -- Anchoring Bias -- Mental Accounting Bias -- ADVICE FOR PRESERVERS -- Chapter 9 The Follower -- UPSIDE/DOWNSIDE ANALYSIS -- BIAS ANALYSIS -- Recency Bias -- Framing Bias -- OTHER BIASES -- Hindsight Bias -- Cognitive Dissonance Bias -- Regret Aversion Bias -- ADVICE FOR FOLLOWERS -- Chapter 10 The Independent -- UPSIDE/DOWNSIDE ANALYSIS -- BIAS ANALYSIS -- Confirmation Bias -- Availability Bias -- Self-Attribution Bias -- Conservatism Bias -- Representative Bias -- ADVICE FOR INDEPENDENTS -- Chapter 11 The Accumulator -- UPSIDE/DOWNSIDE ANALYSIS -- BIAS ANALYSIS -- Overconfidence Bias -- Illusion of Control Bias -- OTHER BIASES -- Affinity Bias -- Self-Control Bias -- Outcome Bias -- ADVICE FOR ACCUMULATORS -- PART Four Plan and Act -- Chapter 12 Capital Markets and Asset Classes -- OVERVIEW OF ASSET CLASSES -- PUBLICLY TRADED EQUITY INVESTMENTS (STOCKS) -- Equity Asset Classes -- Private Equity -- FIXED INCOME INVESTMENTS (BONDS) -- Maturity.

Bond Quality and Credit Ratings -- Interest Rates -- Price and Yield -- Bond Redemption -- Tax Treatment -- Bond Asset Classes -- HEDGE FUNDS -- REAL ASSETS -- Real Estate -- Commodities -- Coin or Art -- SIMPLE PORTFOLIO CONSTRUCTION -- SUMMARY -- NOTES -- Chapter 13 What Is Asset Allocation? -- THE IMPORTANCE OF ASSUMPTIONS -- THE IMPORTANCE OF STRATEGIC ASSET ALLOCATION -- CONSIDERATIONS FOR INDIVIDUAL INVESTORS -- Return Objectives -- Risk Tolerance -- Liquidity -- Time Horizon -- Taxes -- Legal and Regulatory Environment -- Unique Circumstances -- WHY ASSET ALLOCATION IS SO IMPORTANT -- The Magic of Diversification -- Getting Started -- Changing Your Asset Allocation -- Rebalancing 101 -- SUMMARY -- NOTES -- Chapter 14 Financial Planning: A Crucial Step -- WHAT IS FINANCIAL PLANNING? -- WORKING WITH A FINANCIAL PLANNER -- Step 1: Establish and Define the Client-Advisor Relationship -- Step 2: Gather Client Data and Set Financial Goals -- Step 3: Analyze and Evaluate Current Financial Status -- Step 4: Develop and Present Financial Planning Recommendations and Scenarios -- Step 5: Implement Financial Planning Recommendations -- Step 6: Monitor and Update the Financial Planning Recommendations -- WHAT IS A CERTIFIED FINANCIAL PLANNER? -- Education -- Examination -- Work Experience -- Ethics and Continuing Education -- Fiduciary versus Suitability -- How Advisor and Firm Are Compensated -- WHO CAN PROVIDE FINANCIAL PLANNING SERVICES? -- Different Advisors Who May Offer Financial Planning -- Accountant (CPA) -- Estate Planning Attorney -- Insurance Agent -- Investment Advisor -- Stockbroker -- SUMMARY -- NOTES -- Chapter 15 Investment Advice for Each Behavioral Investor Type -- FOUNDATIONS OF BEST PRACTICAL ALLOCATION -- GUIDELINES FOR DETERMINING WHEN TO MODERATE AND WHEN TO ADAPT -- BEST PRACTICAL ALLOCATION FOR PRESERVERS.

BEST PRACTICAL ALLOCATION FOR FOLLOWERS -- BEST PRACTICAL ALLOCATION FOR INDEPENDENTS -- BEST PRACTICAL ALLOCATION FOR ACCUMULATORS -- SUMMARY -- NOTE -- Index.

Achieve investing success by understanding your behavior type This groundbreaking book shows how to invest wisely by managing your behavior, and not just your money. Step by step, Michael Pompian (a leading authority in the practical application of Behavioral Finance concepts to wealth management) helps you plan a strategy targeted to your personality. The book includes a test for determining your investment type and offers strategies you can put into use when investing. It also includes a brief history of the stock market, and easy-to-comprehend information about stocks and investing to help you lay a solid foundation for your investment decisions. Behavioral Finance and Investor Types is divided into two parts. Test Your Type, gives an overview of Behavioral Finance as well as the elements that come into play when figuring out BIT, like active or passive traits, risk tolerance, and biases. The book includes a quiz to help you discover what category you are in. Plan and Act, contains the traits common to your type; an analysis of the biases associated with your type; and strategies and solutions that compliment and capitalize on your BIT. Offers a practical guide to an investing strategy that fits both your financial situation and your personality type Includes a test for determining your tolerance for risk and other traits that will determine your investment type Written by the Director of the Private Wealth Practice for Hammond Associates-an investment consulting firm serving institutional and private wealth clients Behavioral Finance and Investor Types offers investors a better sense of what drives them and what puts on their breaks. By using the information found here, you'll quickly become savvy about the world of investing because you'll come to understand your place in it.

Description based on publisher supplied metadata and other sources.

Electronic reproduction. Ann Arbor, Michigan : ProQuest Ebook Central, 2018. Available via World Wide Web. Access may be limited to ProQuest Ebook Central affiliated libraries.