The Most Important Lesson Investors Can Learn from Behavioral Finance

question 29

Multiple Choice

The most important lesson investors can learn from behavioral finance is

• A) to understand psychological factors influencing long-term price movement.
• B) to have the humility to let professionals manage their investments.
• C) how to avoid letting their emotions and biases affect their investment decisions.
• D) to have confidence in their instincts and first impressions.

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Definitions:

Constituency

A group of electors in a particular region who choose a representative for a law-making body.

Other Party

Refers to the opposing side or participant in a negotiation, discussion, or transaction.

Reputations

The common perceptions or opinions held about someone or something based on their history or past actions.

Agents

Individuals or entities that act on behalf of others in various contexts, such as in negotiations, sales, or representing talent in the entertainment industry.