The stock market is driven by human behavior. Investor psychology—mental patterns—often influences prices more than fundamentals.
**Fear and greed cycle**
Markets swing between optimism and pessimism. Greed pushes investors to buy at inflated prices. Fear causes losses during downturns.
**Common psychological biases**
– Leads to bubbles.
– Loss aversion: fear of losing outweighs gains.
– Often leads to losses.
– Confirmation bias: koss investment guide seeking only supporting info.
**How to control psychology**
– Avoid reacting to noise.
– Balanced portfolios lower stress.
– Discipline prevents impulsive actions.
**Conclusion**
Investor psychology is often underestimated. Mastering emotions means not panicking during crashes. Successful investors know that a calm mindset are as important as financial knowledge.
