What is the cycle of investor emotions?
During times of market volatility, it can be difficult to ignore the noise and stick to your investment plan. Investing has an emotional component, and, at the end of the day, we are all human. This infographic shows some of the common emotions investors experience during a market cycle. By understanding how these impact your behaviour, you can avoid making the mistakes that others often do.
The cycle of investor emotions
Being conscious of your emotions is key to being a successful investor.
To avoid emotional investing, remember that:
- No one can time the market
- Long-term investors are rewarded
- Having a diversified portfolio can help you
- Losses are only realized when you sell the stock at a lower price
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