InvestingNews

Issue 17: The investment emotional cycle

November 2020

Quite often a discussion about the investment emotional cycle starts as markets tend to head south. I recall a number of media articles circulating earlier this year following the February market correction.

The basis of these discussions is often to provide hope that after the crash comes the correction and it’s true to say, that in terms of market growth, this has occurred. There are other lessons we can learn by looking at the cycle from the other side; as markets are rising.

However, the overriding learning from the cycle is to keep emotion and fact separate and perhaps while others are reacting emotionally, to act on the facts when making or changing your investment decisions.

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Ian Irvine – Guest Contributor

Ian has been a keen investor for over 40 years and can draw on his experiences from both investing on his own behalf and also having worked in financial services for more than 30 years. Over this time, he has seen many changes that impact investors’ attitudes to in what and how they invest.

He started his career in what is now referred to as fast moving consumer goods (FMCG) or grocery, working for an Australian margarine manufacturer. In 1986, he was recruited to Westpac around the time of deregulation of the sector, where he spent 10 years before taking a role at AMP and then with ASX for 14 years up to the end of 2017. He continues to be involved with ASX; working on their educational programs.

In 1996, he and his wife established their own SMSF and again the experience and lessons learned regarding managing an SMSF over the years have provided him with many insights and ideas. He enjoys sharing these with others where these are helpful and always suggest that if an investor or SMSF trustee is unsure, that they should seek appropriate advice from a licenced professional.

Ian holds a B. Com (UNSW), and lives in Sydney and enjoys travelling to and meeting investors and SMSF trustee at the educational events with which he has involvement with from time to time.