Understanding Behavioural Biases in Investing

Why investing is not easy:

  • The rules that one needs to apply to identify good investments are fairly simple to learn but when it comes to applying those rules to take live investment decisions, the behavioural biases that we suffer from prevent us from acting in a perfectly rational manner.
  • We have inherited these behavioural biases from our ancestors as these biases are actually favoured traits and helped us survive in the Stone Age. However, what worked in the Stone Age does not seem to work in the stock markets.

In this video, Rohan Advant, Research Analyst, Multi-Act Equity Consultancy Private Limited, helps one understand the origin of behavioural biases focusing on the bias of fear and herding. Further, he states real life examples of how these biases have been experienced in stock markets and lists out ways to overcome them.


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Portfolio Management Services (SEBI Registration No. INP000002965) are offered through Multi-Act Equity Consultancy Private Limited (CIN: U67120PN1993PTC074692), which is a wholly-owned subsidiary of Multi-Act Trade and Investments Private Limited; Investment Advisory Services (SEBI Registration No. INA000008589) are offered through Multi-Act Trade and Investments Private Limited (CIN: U65920MH1997PTC109513).