Wrong lines of thought

Article Abstract:

Quantitative analysis is important for investors, who can be misled by personal judgement. The anchoring effect is one factor that can lead investors to make errors. They may fail to realise that small changes can make a major impact when they are multiplied. Covariances tend to be overestimated, and this can mean that risk levels assumed by investors are too high. Background probabilities should also be taken into account by investors.

Analysis

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Measure for measure

Article Abstract:

Investors may wish to select stocks so that more secure stocks help counterbalance those with more risk, but they need to be able to assess risks.

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Bring the house down

Article Abstract:

There is a tendency to overinvest in housing in Britain, given the risks and rewards involved.

Real Estate, Real Estate and Rental and Leasing, Real estate industry

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