February 1, 2021
Cognitive errors in the way people process and analyze information can lead them to make irrational decisions which can negatively impact business or investing decisions.1
Anchoring Bias Some investors anchor their investment decisions by fixating on a targeted result. Calculations that determine results ahead of investing in a fund portfolio can result in only thinking about future fixed results, disallowing for ongoing flexible guidance. An advisor can study the historical data, performance, and trend changes within the sector(s) in which the fund performs.
Recency Bias When we overvalue the latest information available about investments, we can develop a bias about what we’ve heard most recently and may not be looking at the big picture. Precisely in uncertain times, it is wise to have an experienced advisor guide you in assessing the potential based on useful analytical data.
Loss Aversion Bias The fear of losing money while investing can cause harm for inexperienced investors, for example, in March 2020, when the Dow Jones Industrial Average (DJIA) quickly dropped below 20,000. On November 23, 2020, the DJIA edged back over 30,000, higher than it had been pre-March, 2020 as did the S&P 500. Investors who do not exercise patience during such times as the above period may experience an irretrievable loss. The Loss Aversion Bias only focuses on avoiding losses. Such bias often misguides an investor to miss out on good opportunities for gains.
Confirmation Bias If an investor looks only for information that affirms existing beliefs while discounting contradictory information, important facts may be left out of a decision process. By talking to a certified advisor, you may be less apt to miss essential findings that may help you decide for the best. Advisors have access to many investment analysts and pertinent information on a broad field of market investment knowledge.
Bandwagon Bias Investor tips can circulate among others who may not be tried and proven investors. If not assessed carefully, one might make a hasty investment decision. First, ask your advisor for his or her opinion – and make an informed decision.
Publisher's Copyright & Legal Use Disclaimer Replication is prohibited beyond the use of this
website. The publisher does not guarantee the accuracy and will not be held liable in any way for any error, or
omission, or any financial decision or purchase or use of a financial product, including investment or insurance
products, and suggest that a professional advisor's counsel is sought, especially with regard to Segregated Funds
and Investment Funds which have investment risks as noted in the Fund Disclaimer. All rights reserved by
Disclaimer The particulars contained herein were obtained from sources which we believe are
reliable, but are not guaranteed by us and may be incomplete. This website is not deemed to be used as a
solicitation in a jurisdiction where this representative is not registered. This content is not intended to
provide specific personalized advice, including, without limitation, investment, insurance, financial, legal,
accounting or tax advice; and any reference to facts and data provided are from various sources believed to be
reliable, but we cannot guarantee they are complete or accurate; and it is intended primarily for Canadian
residents only, and the information contained herein is subject to change without notice. References in this Web
site to third party goods or services should not be regarded as an endorsement, offer or solicitation of these or
any goods or services. Always consult an appropriate professional regarding your particular circumstances before
making any financial decision.
Commissions, trailing commissions, management fees and expenses all may be associated with investment funds,
including segregated fund investments. Please read the fund summary information folder prospectus before investing.
Investment Funds and/or Segregated Funds may not be guaranteed, their market value changes daily and past
performance is not indicative of future results. The publisher does not guarantee the accuracy and will not be held
liable in any way for any error, or omission, or any financial decision. Talk to your advisor before making any
financial decision. A description of the key features of the applicable individual variable annuity contract or
segregated fund is contained in the Information Folder. Any amount that is allocated to a segregated fund is
invested at the risk of the contract holder and may increase or decrease in value. Product features are subject to