Psychological biases

Automatically transcribed from the showcased film. Wording may contain errors. This is the client’s narration, not advice from FDM.

And even if they are, client problems are always your problems. Now that we have discussed the pitfalls occurring because of these biases, we will move to discuss four best research proven methods and strategies to minimize their effects. Here's a playbook you can follow. It will help you as an MFD to guide your clients in the right direction. The first step for an MFD is to actively educate clients about these biases before they make mistakes, organizing regular workshops, short webinars or even simple WhatsApp infographics that highlight common traps like herding or loss aversion. When you make your clients aware of the various pitfalls involved in biases, you reduce the chances of them acting on impulse. In fact, research shows that consistent training and awareness programs can reduce biased investment decisions by up to 40%. The second method is of structured investment processes.