Nudging Financial Behaviour

We’ve reached the end of Season 2 of The Nudging Financial Behaviour Podcast. In this episode, you’ll get some bonus questions and answers from all of our guests for the season. We’ve asked them to analyse their own financial behaviour when it comes to the many biases we unpacked throughout the season. It’s really great to see that we are all human and even people who are experts in finance and behavioural finance can fall prey to these biases. It’s completely natural! And of course, we can’t wrap up season 2 without saying thank you to our sponsor – IG Markets South Africa – as well as to all of our guests, and the team that helped to put this podcast together. Be sure to like this episode and hit the subscribe button to get notified when new content drops on the channel – there will definitely be more coming soon. You can also read more on my blog: https://www.nudgingfinancialbehaviour.com/better-financial-decisions/ Or watch to the video version of this podcast episode: https://youtu.be/VqGguBZg7vE Special thanks to everyone who has helped put this series together:

We’re wrapping up Season 2 of The Nudging Financial Behaviour Podcast and asking all of our guests for the season some interesting questions about their own financial behaviour. We extract some final additional wisdom to help all of us make better financial decisions. You don’t want to miss the final episode of the season!

In this episode of The Nudging Financial Behaviour Podcast, we’re looking at how you can overcome Home Bias by chatting about diversification. This is a risk management strategy for investing and a vital part of any investment portfolio. To help us really understand diversification, we’ve got the queen of ETFs and of spreadsheets Nerina Visser as our guest. Nerina gives plenty of practical tips to help you get to grips with your portfolio and how to ensure you’re properly diversified. Useful links: More about Nerina Visser: https://www.linkedin.com/in/nerina-visser-cfa-26a2272/https://www.nudgingfinancialbehaviour.com/wp-content/uploads/2024/03/nerina_visser_spreadsheet.xlsx More information on those graphs and pie charts for asset classes - https://www.oldmutualinvest.com/v3/assets/bltf97ab615862b2667/blte1128e0b17590e60/64704ad5e736052b09502459/Long-Term_Perspectives_2023.pdf Fund managers exhibiting home bias study - https://www.econstor.eu/bitstream/10419/22408/1/dp-296.pdf Be sure to like this episode and hit the subscribe button to get notified when the next episode drops. You can also read more on my blog: https://www.nudgingfinancialbehaviour.com/diversification-in-investing/ Or watch to the video version of this podcast episode: https://youtu.be/-EXDsQBrSd0 Special thanks to everyone who has helped put this series together:

Episode 9 of The Nudging Financial Behaviour Podcast is coming soon and we’re continuing our discussion on home bias by looking at diversification. We’ve also got Nerina Visser as our guest to help with some very practical tips.

Home bias is just what it sounds like – you prefer to choose things that are closer to home. For investing, this can mean that you have too many assets in your portfolio that are linked to the country you’re living in or the company you work for – and this can lead to major problems. One of Gizelle’s former PHD students, Shreeya Jugnandan, is our guest for this episode. Shreeya actually unpacked Home Bias for her thesis. She found some interesting stats when looking at how South African’s invest and the disconnect between where they want to live vs where they want to invest their money. She also developed a and has a practical model to help us combat behavioural biases in your investing decisions. Useful links: More about Dr Shreeya Jugnandan: https://www.linkedin.com/in/dr-shreeya-j-b18781102/https://onlinelibrary.wiley.com/doi/10.1111/ijcs.12935 The Causal Impact of Media in Financial Markets - https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1462416 More on the collapse of Silicon Valley Bank: https://www.youtube.com/watch?v=QACGoKb48_0https://fortune.com/2023/03/27/silicon-valley-bank-staff-lose-millions-stock-collapse-salary-packages/ More on the studies Shreeya mentions: https://doi.org/10.1016/j.jbef.2018.04.002https://doi.org/10.2139/ssrn.2421214https://doi.org/10.1016/j.iimb.2015.09.001https://doi.org/10.1002/bdm.561 Be sure to like this episode and hit the subscribe button to get notified when the next episode drops. You can also read more on my blog: https://www.nudgingfinancialbehaviour.com/mitigating-bias/ Or watch to the video version of this podcast episode: https://youtu.be/AVkqODKbfE8 Special thanks to everyone who has helped put this series together:

It’s the home stretch for season 2 of the Nudging Financial Behaviour Podcast and we’re kicking it off by exploring Home Bias in episode 8. We’ve also got some practical tips for avoiding this bias from Dr Shreeya Jugnandan. She delivered a framework to help us manage our biases (generally) when making decisions – you don’t want to miss that!

In this episode of The Nudging Financial Behaviour Podcast, we’re looking at two biases that are all about the order in which you receive information and how that can impact the way you make decisions. These are the Primacy Effect (also known as First Impression Bias) and Recency Bias. They’re similar but not quite the same. To help us with our discussion and to give us some more insights into how our biases can impact the way we trade or invest, we’ve got Kristia van Heerden as our guest. Kristia is the Global Education Lead for IG Markets South Africa (the sponsor for this podcast) and has plenty of experience in the trading world. We get straight into it… and talk about common trading mistakes. So, of course, we’re unpacking stop losses and other vital tools that should be part of your trading plan. Useful links: More about Kristia van Heerden: https://justonelap.com/the-fat-wallet-show/https://za.linkedin.com/in/kristiavheerden Solomon Asch experiment - https://psycnet.apa.org/doiLanding?doi=10.1037%2Fh0055756 Recency and primacy in persuasion as a function of the timing of speeches and measurements by Miller and Campbell - https://psycnet.apa.org/doiLanding?doi=10.1037%2Fh0049330 Be sure to like this episode and hit the subscribe button to get notified when the next episode drops. You can also read more on my blog: https://www.nudgingfinancialbehaviour.com/trading-mistakes/ Or watch to the video version of this podcast episode: https://youtu.be/hCx-J_hA1aM Special thanks to everyone who has helped put this series together:

We’ve got a two-for-one special happening in episode 7 of The Nudging Financial Behaviour Podcast! We’re discussing First Impression Bias (or the Primacy Effect) and Recency Bias. We also chat to Kristia van Heerden about the reality of stop-losses and some strategies for trading success. Make sure you stay tuned for the discussion – coming next week.

Availability bias is all about how we are influenced by information that is readily available, and how we often don’t do enough research before making decisions. In episode 6 of The Nudging Financial Behaviour Podcast, we’re breaking down this bias and taking a look at just how big an impact it can have when we aren’t focusing on the bigger picture or doing the right research. Our guest for the episode is professor Hersh Shefrin – a legend and pioneer in the field of behavioural finance. It’s an honour to have him on the podcast, and the stories he has to tell are fascinating! Of course, we had to also chat about his book: Beyond Greed and Fear. Useful links: More about Professor Hersh Shefrin: https://www.amazon.com/stores/author/B001HCZZLE/abouthttps://www.scu.edu/business/finance/faculty/shefrin/ The Psychology of Human Misjudgement by Charlie Munger - https://www.youtube.com/watch?v=zNxsAhc6sk8 More on Rolf Dobelli: https://www.amazon.com/Art-Thinking-Clearly-Rolf-Dobelli-ebook/dp/B00IZP6EVQ/https://www.youtube.com/watch?v=-miTTiaqFlI Be sure to like this episode and hit the subscribe button to get notified when the next episode drops. You can also read more on my blog: https://www.nudgingfinancialbehaviour.com/availability-bias-fear-and-hope/ Or watch to the video version of this podcast episode: https://youtu.be/1Od5D1vqbas Special thanks to everyone who has helped put this series together:

It pretty much goes without saying that any decision we make is based on the information we have at hand – and this is where availability bias comes in. We’re talking to professor Hersh Shefrin in episode 6 of The Nudging Financial Behaviour Podcast to help unravel this bias. And of course, we can’t chat to him without talking about two treacherous emotions: fear and greed!

Impression management is exactly what you think it is – tactics and strategies deployed to manage the impression you have of someone or something. What’s important to know is that loss aversion and the understanding of how that impacts human behaviour is a large part of those impression management tactics. For episode 5 of The Nudging Financial Behaviour Podcast, we’re calling on someone from outside of the finance and investing community to help us understand this topic. Our guest is Candice Burgess-Look – a PR specialist who knows exactly how to create a positive impression for her clients. More about Candice Burgess-Look: https://www.linkedin.com/in/candice-burgess-look-895b3537/https://kingofthejungle.co.za/ More on Prospect Theory: https://www.nudgingfinancialbehaviour.com/loss-aversion/https://www.nudgingfinancialbehaviour.com/loss-aversion-vs-risk-aversion/ Season 1 episode 8 - The Framing Effect: https://www.youtube.com/watch?v=RhPYfYHsAmMhttps://nudgingfinancialbehaviour.podbean.com/e/the-framing-effect-episode-8-season-1/ Be sure to like this episode and hit the subscribe button to get notified when the next episode drops. You can also read more on my blog: https://www.nudgingfinancialbehaviour.com/impression-management-techniques/ Or watch to the video version of this podcast episode: https://youtu.be/pInMPXGwLyA Special thanks to everyone who has helped put this series together:

Did you know that it’s possible to use loss aversion to your benefit? This is where impression management comes in, and this is what we’re covering in episode 5 of The Nudging Financial Behaviour Podcast.

We’re still looking at loss aversion in episode 4 of The Nudging Financial Behaviour Podcast – that’s right, it’s a big topic! Today, we’re breaking down the disposition effect, which is all about how loss aversion manifests itself in the world of investing. Our guest is Professor Terry Odean from the Haas School of Business at the University of California in Berkeley. He is a prolific author and researcher on the topic of behavioural finance and one of the inspirations for my own academic career. Useful links: More about Professor Terry Odean: https://scholar.google.com/citations?user=ubzu7jQAAAAJ&hl=enhttps://www.youtube.com/c/makingsmartfinancialdecisions The emerging market study - https://journals.sagepub.com/doi/abs/10.1177/0972652718776861 Be sure to like this episode and hit the subscribe button to get notified when the next episode drops. You can also read more on my blog: https://www.nudgingfinancialbehaviour.com/the-disposition-effect/ Or watch to the video version of this podcast episode: https://youtu.be/lDDriBM7Zpw Special thanks to everyone who has helped put this series together:

It’s time to look at how loss aversion manifests itself in our investing decisions – introducing the disposition effect. Episode 4 of The Nudging Financial Behaviour Podcast is coming soon!

In episode 3 of The Nudging Financial Behaviour Podcast, we’re looking at uncertainty and how it differs from risk. This discussion is all about known and unknown probabilities. We also unpack two biases – The Gambler’s Fallacy and The Hot-Hand Effect. We thought that the best way to really get to grips with these biases was to chat to someone who knows a lot about trading. Our guest is Garth Mackenzie, a prolific trader with plenty of exciting stories to tell about his years working on the markets. Useful links: More about Garth Mackenzie: https://www.linkedin.com/in/garth-mackenzie-05115a52/https://iono.fm/c/4983 Risk, Ambiguity, and the Savage Axioms by Daniel Ellsberg - https://www.jstor.org/stable/1884324 Belief in the Law of Small Numbers but Amos Tversky and Daniel Kahneman - https://www.stats.org.uk/statistical-inference/TverskyKahneman1971.pdf Be sure to like this episode and hit the subscribe button to get notified when the next episode drops. You can also read more on our blog: https://www.nudgingfinancialbehaviour.com/navigating-uncertainty/ Or watch to the video version of this podcast episode: https://youtu.be/jSbbeBHaW8Y Special thanks to everyone who has helped put this series together:

Did you know that there’s a difference between risk and uncertainty? It can totally change the way you look at making financial decisions. In episode 3 of The Nudging Financial Behaviour Podcast, we dive even deeper into our discussion on risk and loss aversion.

Loss aversion is a big bias. It can impact us in so many ways – causing us to make strange decisions about money. This bias can actually cause you to become risk seeking when you’re faced with a possible loss and then risk averse when you have a gain on your hands. Yes, that’s quite complex behaviour… so we break it down for you carefully. Our guest for episode 2 is Dr Greg Davies. He heads up the behavioural finance division of Oxford Risk in the UK and knows a lot about loss aversion. We also chat to him about risk tolerance (our topic from episode 1) because it would be wrong not to! Useful links: More about Greg Davies: https://www.linkedin.com/in/gregbdavies/https://rpc.cfainstitute.org/en/research/foundation/2017/new-vistas-in-risk-profiling American Economic Association study on the PGA Tour - https://www.aeaweb.org/articles?id=10.1257/aer.101.1.129 Journal of Personality and Social Psychology medical information study - https://psycnet.apa.org/record/1987-22913-001 You can also read more on my blog: https://www.nudgingfinancialbehaviour.com/loss-aversion/ Or watch the video version of this podcast episode: https://youtu.be/9GR4OMTbzIo Special thanks to everyone who has helped put this series together:

And just like that, we’ve hit the ground running with season 2! The second episode of the Nudging Financial Behaviour Podcast is coming soon. We’re continuing our discussion from episode 1 with an in-depth look at loss aversion and how that can impact our trading decisions.

To kick off season 2 of The Nudging Financial Behaviour Podcast, we’re talking about a big topic – risk. Risk aversion and risk tolerance are two big concepts that you need to wrap your head around if you want to understand one of the strongest pulls on how and why you make specific decisions about your money. To help us unpack risk tolerance, we have high performance coach, trainer and trading consultant Steve Ward as our first guest. Steve has written many books on the subject of risk, as well as running his own business that helps people to be better traders – Performance Edge Consulting. This season, we’re actually doing a miniseries on risk and loss aversion, and this is the start of the discussion. We’ve got a lot to go through, and it’s going to be fascinating! More about Steve Ward: https://performanceedgeconsulting.co.uk/about-steve/https://www.amazon.com/stores/author/B004O959I6?ingress=0&visitId=2ecff16b-dd8a-48bb-b844-ff3b8000702c HUM talk on risk tolerance: https://www.youtube.com/watch?v=-nPvZ1jkaPc Book your tickets for the “Blonde” cast of Legally Blonde The Musical: https://www.webtickets.co.za/v2/Event.aspx?itemid=1536610304 The “Blonde” cast is performing on the following dates: You can also read more on my blog: https://www.nudgingfinancialbehaviour.com/risk-tolerance/ Or watch to the video version of this podcast episode: https://youtu.be/Tu5NCYT0j1s Special thanks to everyone who has helped put this series together:

Are you ready for season 2 of The Nudging Financial Behaviour Podcast? Episode 1 is dropping soon – so stay tuned! In this episode, we’re jumping right into talking about risk and understanding how your ability to tolerate risk can impact your money decisions.