Investing Personality
Herd Investors

Summarized Overview

In this article you will find information about,

• herd investors profile.
• who have this investing personality.
• some advice if you are one of them.

Herd Investors Profile

Herd investor is known as having little vision and goals in financial and investment planning. Similar to reserved investors, you tend to dispose all your stocks whenever you hear there is bad news threatening the company in which you have invested.

But unlike reserved investors, you often do not have the ability to make your own decision because of your habit of following others. You are not an interested investor and view stock investing as a risky venture, but then you are still betting on stock market to make fortune.

Rather than seeking excellence, you choose the middle-of-the-road path and at times, prefer someone investing on your behalf. Hence you rely heavily on your investment adviser or stock broker.

As an individual investor, you are risk averse and prefer to play safe by putting your savings or retirement fund into high quality companies even though the dividend yield may be low. You are comfortable with lower return than the inflation rate as you prefer the safe approach.

Weaknesses

• Follow others too often, and
• Vulnerable to be attacked by speculative investors and discipline investors.

Who Are They

First timers, novice investors, beginners, or green-horn investors like the self-employed or professional employees.

Advice for Herd Investor

• Take slightly more risk than usual,
• Learn to live with a bit more risk comfortably,
• Attend investment workshops and continue to invest in your investment knowledge, and
• Stay away from stock market when in doubt. Put your money into safer investment options such as cash deposits in the meantime.

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