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LETTER: Avoid 'gut reactions' when investing

LETTER: To avoid junk investment mistakes, we always should avoid gut feelings, unsupported opinions and ideological bias.


To avoid junk investment mistakes, we always should avoid gut feelings, unsupported opinions and ideological bias.

Gut feelings are notoriously fallible, but we tend to protect our self-worth, dismissing mistakes we make investing based on them. You may have a false sense of security in the belief that precious metals are the best overall investment but when you actually think about it, you realise it isn’t gold that will save your investments but rather timely buying and selling strategy decisions (Debunkery: Learn It, Do It, and Profit from It by Ken Fisher on Pg. 151) of any commodity, according to respected knowledgeable investors.

Unsupported or poorly supported opinions are not what I would expect from anyone giving investment advice. Remember that the “market is an exceedingly efficient discounter of (so-called) well-known information” (Fisher, 151) and those preying on your fears, anxiety and stress about your investments (runaway inflation/dollar devaluation) will use their poorly supported opinions to fuel your bad investment decisions. Fear and the false threat used to create it are irrational motivators, not the stuff of thoughtful, careful, critical deliberations. Unsupported opinions by anyone aren’t worth anything.

Finally, ideological bias is currently a well-known primary irrational decision motivator. It is a cognitive psychological nudge and a nod, a strong cue – studied extensively by psychologists – moving people to say and do some irrational things like knee-jerk investment decisions or dumb one finger decals proudly displayed on pick-up truck bumpers. Gold is “just a commodity – volatile like any other … there is nothing golden about gold” (Fisher, 151).

Don’t be fooled by dupesters appealing to your ideological bias. It is important to avoid taking advice from people – even CEOs – appealing to gut feelings, projecting poorly supported opinions and using their improper appeal to the biased authority of their unsupportable ideology to convince you. Invest wisely without ideological bias and your neighbourhood huckster’s manipulative nudges.

Jim Gough,


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