Four Mental Mistakes to Avoid Now
Investing is so simple, any idiot can do it. The problem: There aren't enough idiots.
Let's face it, amassing a decent-size nest egg isn't exactly rocket science. All we have to do is save regularly, buy a few low-cost mutual funds and patiently await our reward.
Yet most of us scorn such humble simplicity. Instead, we are too confident and too clever. Result? Consider some of the mental mistakes that investors are now making.
Without a Doubt
Over the past few years, investors have flocked to exotic investments such as commodities, emerging-market stocks and gold shares. At first blush, this is a little surprising.
Our financial tastes usually run to the familiar, like certificates of deposit and savings accounts. And if we do venture into stocks, we tend to stick close to home, favoring our employer's stock, local corporations, blue-chip U.S. shares and companies whose products we know.
So what has prompted us to dabble in commodities, emerging markets and gold? The answer, in a word, is "performance." These wild-and-crazy investments have all posted dazzling gains in recent years, and that has had a powerful effect on investor psychology.
"People tend to buy the investments they wish they had bought last year," says Terrance Odean, a finance professor at the University of California at Berkeley. "Partly, people simply extrapolate the past trend. But also, people feel that the markets are more predictable than they really are."
If we were rational, we would grow leery as an investment rises in price, because we are now paying more for the same investment. Instead, however, we are drawn to hot stocks and hot mutual funds, because we assume that the future will look like the immediate past.
In fact, after a while, good performance -- coupled with the enthusiastic chatter of friends and pundits -- can make even exotic investments seem like a safe bet. What if we bite the bullet and buy? If the investment continues to climb, that further bolsters our confidence, as we attribute the gains to our own investment savvy.
"People who are successful tend to presume they have skill," Prof. Odean says. "They feel they know what they're doing. People confuse success with brains."
Getting Even
Starry-eyed investors in commodities, emerging markets and gold may have had a rough ride in 2006, but they haven't really suffered for their overconfidence. But be warned: The good times and good feelings could quickly evaporate -- as homeowners can attest.
"People will say, 'Oh, the real-estate market is slow,' " notes Meir Statman, a finance professor at Santa Clara University in California. "What they're really saying is, 'I don't want to sell at the current price.' They priced their home at $1 million because their neighbor sold at $1 million a year ago. But their home has been on the market for three months and maybe the price it will sell at now is $800,000."
Rather than accepting that market conditions have changed, home sellers today are often fixated on the price they paid or the price they could have gotten at the market peak. Indeed, whether it is real estate or stocks, folks like to "get even, then get out."
This, of course, is partly about making money. But it is also about avoiding regret. If we sell for less than we paid or less than the neighbors got, we have to admit we made a mistake, with all the associated pangs of regret.
This gets particularly messy with real estate. Every trading day, the financial markets tell us what our stocks, bonds and mutual funds are worth. Houses don't offer the same ongoing reality check.
"There is a lot more room to delude yourself with real-estate prices," says John Nofsinger, a finance professor at Washington State University in Pullman, Wash. "Until a transaction actually occurs, you can let your optimism run wild."
In fact, when real-estate prices sag, the number of homes sold will typically decline sharply, as homeowners refuse to sell for less than they think their properties are worth. It appears we're seeing this sort of sales slowdown in 2006.
What Goes Down
Just as investors assume rising investments will keep on rising, they look at tumbling investments and extrapolate those losses. In fact, if the suffering goes on for long enough, some investors become convinced that endless losses lie ahead and they will bail out.
Lately, folks have been bailing out of inflation-indexed Treasury bonds -- and then writing to tell me I'm an idiot. Why write to me? I have recently been advocating that investors buy inflation-indexed Treasurys, formally known as Treasury Inflation-Protected Securities, or TIPS.
When an investment tumbles in value, it's sometimes a sign that the underlying fundamentals have deteriorated and thus selling could be a smart move. Yet it would be hard to argue that the fundamentals have deteriorated with inflation-indexed Treasurys.
After all, if you hold these bonds to maturity, they offer a government-guaranteed inflation-beating return. In early February 2005, 10-year inflation-indexed Treasury notes were paying less than 1.5 percentage points above inflation. Today, they are paying some 2.3 percentage points above inflation.
In other words, if investors buy today, they are guaranteed a higher after-inflation return. The fundamentals have improved, not deteriorated. So why are people selling? Blame it on investor psychology.
Losing Control
According to the Commerce Department's Bureau of Economic Analysis, the U.S. savings rate turned negative over the three months through June 2005 and it has remained that way ever since.
Partly, this reflects our struggle with self-control. Instead of rationally socking away money on a regular basis, we prefer to spend today and put off saving until tomorrow.
I suspect the negative savings rate, however, is also driven by our overconfidence. Sure, we know we aren't saving enough for retirement and for our kids' college education. But we figure that somehow or other, things will work out OK. A mental mistake? It may be our biggest.
避免四大心理误区
投资实在是太简单了，连傻子都会。但问题是，傻子并不多。
咱们实话实说吧：攒足一笔钱，让自己过个舒适体面的退休生活其实并不是什么复杂的事。我们要做的不过是定期存一部分钱，买一些低成本的共同基金，然后耐心地等待回报。
然而，我们大多数人却对这个朴实无华的简单道理嗤之以鼻。我们都太自信，太聪明。结果怎样呢？让我们看看投资者都有哪些心理误区。
毫无疑虑
在过去几年里，投资者纷纷涌向新奇的投资品种，比如商品交易、新兴市场股票和黄金类股。乍一看来，这让人有点儿出乎意料。
我们通常更偏好熟悉的投资方式，如定期大额存单和储蓄帐户。如果冒险投资股票，也往往挑选自己最熟悉的类别，如所在企业的股票、当地企业的股票、美国蓝筹股和那些我们了解其产品的公司股票。
那么是什么促使我们涉足商品交易、新兴市场股票和黄金类股的呢？简而言之就是──业绩。这些投资品种近年来的收益令人咋舌，这对投资者的心理造成了很大的冲击。
“人们往往会投资于那些他们希望在去年就买进的投资产品，”加州大学伯克利分校(University of California at Berkeley)金融学教授特伦斯?奥迪恩(Terrance Odean)说。“部分原因在于，人们简单地根据过去的趋势预测现在的情况，另外，人们以为市场比它们的实际情况更可预测。”
如果我们理性的话，应该对那些不断上涨的投资项目保持警惕，因为现在我们要为同样的投资付出更多资金。然而，热门的股票和共同基金总让我们难以抗拒，我们想当然地以为未来的走势还会和不久以前一样。
事实上，经过一段时间之后，出色的业绩──伴随著朋友和行家们的热烈讨论──甚至可以令那些非常规的投资项目看起来似乎也像是万无一失的赌注。假设我们孤注一掷，买下了会怎样？如果投资继续升值，我们的信心会进一步增强，因为我们会把收益归功于自己独到的投资眼光。
“投资成功的人往往会认为自己有这个能力，”奥迪恩教授说。“他们自以为很清楚自己在干什么。人们经常把成功和头脑混为一谈。”
赚到钱，再离开
那些投资于商品、新兴市场和黄金的乐观派在2006年可能遇到了一些坎坷，但并未因他们的自负而吃苦头。但要警惕的是：好日子和好心情随时都可能飞走。房地产投资者可以证明这一点。
“人们会说，‘噢，现在房地产市场不景气，’”加州圣克拉拉大学(Santa Clara University)金融学教授迈尔?斯塔特曼(Meir Statman)说。“他们其实想表达的意思是，‘现在这个价格我还不想卖’。他们觉得自己的房子值100万美元，因为一年前他们的邻居就是100万卖的。但他们的房子已经放在市场上三个月了，现在也许只能卖80万美元。”
如今的售房者仍对自己曾为此支付的价格或者他们有可能在市场高点获得的价格念念不忘，而不愿意接受市场状况已经改变这个事实。实际上，不管是房地产还是股票投资，人们都愿意“赚到钱，再离开。”
这句话的一部分意思当然是讲挣钱，但另一方面也提到了要避免留下遗憾。如果我们的售价低于买进的价格或低于邻居房屋的售价，我们就不得不承认自己犯了错，并为此痛心不已。
房地产市场在这方面尤其难以预料。金融市场在每个交易日都会告知我们所持有的股票、债券和共同基金价值几何。然而，房地产却不会提供类似的实时报价。
“房地产的价格特别能蛊惑人心，”华盛顿州立大学(Washington State University)金融学教授约翰?诺夫辛格(John Nofsinger)说。“在交易发生之前，你尽可以做美梦。”
事实上，当房地产价格下跌时，房屋销售量通常会骤然减少，因为房主不愿看到售价低于其理想价位。2006年房屋销售似乎就出现了此类下滑。
“贬值”的投资
正如投资者认为升值的投资会继续升值，在他们看来，走势不利的投资也会一直跌下去。事实上，如果这种痛苦局面维持了相当长的时间，有些投资者就会深信，前方是无穷无尽的亏损，于是他们就跳了出来。
最近，投资者纷纷退出通胀指数国库债券，然后写信说我是个白痴。为什么要写给我呢？因为我最近一直在号召投资者购买通胀指数债券──其正式名称叫通胀保障国库债券，即TIPS。
当一笔投资贬值时，在某些情况下，这意味著基本面已经恶化，因此脱手可能是明智之举。不过，我们现在很难说通胀指数国债的基本面已经恶化了。
毕竟，如果你将这些债券持有至到期日，将得到受政府担保的不受通胀影响的回报。2005年2月初，10年期通胀指数国债的收益率比通货膨胀率只高出不足1.5%，而现在已经高出2.3%了。
换句话说，如果投资者现在购买，他们将保证获得更高的收益率。基本面是改善，而非恶化了。那么为什么人们还在卖出通胀指数国债呢？那是投资者的心理在作怪。
恣意消费
据商务部经济分析司统计，在截至2005年6月的三个月时间内，美国储蓄率跌至负数，此后一直处于这种局面。
这种情况在一定程度上反映了我们的自我放纵。我们不再理性地定期储蓄，而是更愿意今朝有酒今朝醉，将储蓄的事留到明天。
不过，我怀疑负储蓄率还和我们的过分自信有关。当然，我们心里清楚还没有为将来退休和孩子上大学攒到足够的钱，但我们还是天真地认为车到山前必有路。这难道不是一个心理误区吗？也许还是一个最大的误区。
Jonathan Clements
