When it comes to investing money, human nature likes to play tricks on us. When the stock market is reaching new highs, we can’t wait to jump in. When it stumbles and falls, we stop investing — or worse, start selling.
As a result, the typical investor tends to buy “high” and sell “low” — the opposite of a profitable investment strategy. But in spite of the lessons of the past, that inner voice keeps urging us to follow the crowd.