Product Description
“Pompian is handing you the magic book, the one that reveals your behavioral flaws and shows you how to avoid them. The tricks to success are here. Read and do not stop until you are one of very few magicians.”
—Arnold S. Wood, President and Chief Executive Officer, Martingale Asset Management Fear and greed drive markets, as well as good and bad investment decision-making. In Behavioral Finance and Wealth Management, financial expert Michael … More >>
This book provides tremendous insights into the mindset of investors. Pompian explains relatively complex behavioral finance topics in a very fluid and easy to understand manner. This book is a “must have” for advisors who really want to understand the emotional biases that influence their client’s investment decisions.
Rating: 5 / 5
Mr. Pompian has written a valuable introduction to the field of applied behavioral finance. He structures the book such that different behavioral biases are presented in short, technical, and applied discussions. This layout is helpful if the reader is looking for a modular reference book (or learns well within that pattern), but it makes the book difficult for those who desire a greater narrative flow. The ideal reader for this book is well defined: the practicing wealth manager who seeks to better adapt his or her practice to clients (or, if necessary, vice versa) without sacrificing the integrity of rational investment strategy.
It is important to note that Mr. Pompian’s names, descriptions, and classifications of behavioral biases are not complete and established truth; other authors present different takes on various biases. Mr. Pompian here wins plaudits for being more thorough than most in the number of biases covered, though I found a few of his characterizations somewhat overlapping one another due to the sheer number of biases presented. He is also quite good at citing references and further reading: this book is quite well placed in the technicality spectrum as written for the practitioner — neither simple enough for the layperson, nor sufficiently rigorous for the academic. Other texts work better for those who require more or less of a technical presentation.
To sum: this book is one of several potential good introductory texts to behavioral finance, but non-practitioners will likely find it lacking.
Rating: 4 / 5
One of the most important books on the subject of behavioural finance. Covers the subject in a comprehensive manner and provides great insights for constructing investment portfolios which are rational and closer to investor behaviour. Provides an excellent tool for enhancing real life returns of investor.
Rating: 5 / 5
This excellent, practical guide helps you apply behavioral finance information to your personal wealth management. Though Michael M. Pompian chiefly addresses a readership of professional investment advisers, any investor can benefit from learning more about the irrational factors that affect investment decisions. Readers can choose among many books about behavioral finance, cognitive biases and neuroeconomics. However, very few books can match this one’s hype-free, objective and accessible exposition of this subject. The author provides a brief history of behavioral finance, a thorough catalog of noteworthy investor biases, advice on how to deal with these biases, examples and the likely direction of future research in the field. getAbstract highly recommends his book for its straightforward language, which makes it widely accessible.
Rating: 5 / 5
Especially in these crazy financial times, this is a good book to do some self-analysis through little quizzes and learn how emotions can take over from making good, rational financial decisions. While somewhat geared for financial advisors, it definitely is readable for the intelligent investor who can take the time to read and apply the lessons learned from this book.
Rating: 5 / 5