An article in the Australian Financial Review a few months ago resurfaced recently and got me thinking. The article highlighted retirees who had put their super into term deposits and were now finding it very difficult to meet their income needs given the continued drop in interest rates.
It was not that long ago that some pundits were reporting Australian’s were facing a 40% fall in house prices. In my view, extreme headlines like this plastered across media outlets over and over again are motivated by ‘selling’ news and attracting attention.
The events of the past week resulting in reputational turmoil and possible legal action, from clients, against listed asset manager and financial adviser, Evans Dixon, once again baffles me!
Why is it that company Directors would over complicate their business model, compromise their clients’ best interests, jeopardise their reputation and risk a toxic internal culture? Unfortunately, the answer is simple – Greed.
Making financial decisions about investing or your financial future is not all about the numbers, it is also about psychology. As we have seen quite clearly in the last couple of weeks, markets tend to be erratic and often irrational, but being aware of your behavioural biases can help us cope when the market turns against us.
For a while now the US and China have been in the grips of a trade-war, and events over the last week or so have seen things heat up with world share markets suffering.