Trustnet Magazine 52 June 2019 | Page 4

Cover Story 4 / 5 [ SINS ] Human weaknesses cited in early Christian teachings are still behind many of the biggest mistakes made by investors today, writes Danielle Levy The seven deadly sins I t’s tough for anyone to recognise their own shortcomings – and the world of investing is no different. However, investors face a key challenge: behavioural traits and mistakes are often laid bare when you check your portfolio’s performance. The numbers are plain to see. It is then a question of whether you are willing to assess what has worked and what hasn’t. What’s more, it is important to ask yourself whether there are any behavioural traits that are responsible for these mistakes. The seven deadly sins, which were formulated in early Christian teachings, aptly describe some of the most common mistakes that investors make with their portfolios. “All the sins bleed into one another, but the crux of all of these unholies FE TRUSTNET is ego. Once your ego creeps into your decision-making, it’s a one- way ticket to Doomsville,” explains David Coombs, head of multi-asset investments at Rathbones. “Your judgment is skewed and it’s no longer about the objective, it’s about you.” So how can the seven deadly sins hurt your portfolio? “All the sins bleed into one another, but the crux of all of these unholies is ego. Once your ego creeps into your decision-making, it’s a one-way ticket to Doomsville” trustnet.com