7 mental traps to avoid when you’re investing

This episode was originally part of the Market Memo newsletter, where you learn about sharemarket investing every week. You can subscribe to that, here https://marketmemoweekly.substack.com/

It’s never been easier to start investing. And that’s both brilliant, and part of the problem.

Between constant headlines, market swings, hot takes on social media, and apps that let you trade with a swipe, investing has turned into a psychological minefield.

Now, for most people, the biggest risk to their money isn’t the market. It’s their own brain.

In this episode of Making Cents, it’s the seven common mental traps that trip investors up.

We’ll cover:

• Why losses hurt so much more than gains (and what that makes people do)

• How herd behaviour and FOMO sneak into otherwise sensible decisions

• Why sticking to what feels familiar can cost you real growth

• The mental shortcuts that make short-term noise feel more important than long-term plans

• And the simple systems that help emotions stop driving the car

This episode isn’t about suppressing your feelings or becoming some emotionless investing robot.

It’s about understanding how your brain works, and putting smart guardrails in place so it doesn’t sabotage your future.

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This podcast was filmed & produced by Fanaticals

Video editing & content production by Lana Byrne

Audio engineering by Tash Chittock

#MakingCents #FrancesCook #InvestingPsychology #BehaviouralFinance #MoneyPsychology #InvestorMindset #MentalTraps #Investing

Chapters

• 00:00:00 Introduction
• 00:02:18 Loss aversion: the pain hits harder than the pleasure
• 00:03:31 Overconfidence bias: the 'I can time the market' illusion
• 00:05:21 Herd behavior and FOMO: when everyone's buying, beware
• 00:07:13 Home bias: comfort can cost you
• 00:08:31 Confirmation bias: the echo chamber effect
• 00:09:39 Recency bias: thinking yesterday predicts tomorrow
• 00:10:48 Present bias: the 'now' trap
• 00:12:19 Wrapping up: stop emotions from driving the car
• 00:13:00 Outro