• / Free eNewsletters & Magazine
  • / My Account
Home>Practice Management>Practice Builder>5 Biases of 'Accumulator' Clients

Related Content

  1. Videos
  2. Articles
  1. Nygren: Value Managers Love Growth but Don't Overpay for It

    The Oakmark manager discusses a value case for Google , his team's three-pronged investment approach, and why capacity is not a major issue for the Oakmark Fund.

  2. College Expectations, Loan Rates at Crossroads

    Debates on Stafford Loan rates continue in Washington as the July 1 deadline approaches, while this year's college grads might be too optimistic of near-term job success.

  3. New T. Rowe Target-Date Series Aims for Less Volatility

    T. Rowe's new target-date strategy differs from its flagship product by providing a lower equity allocation at retirement time and creating more predictability of returns, says manager Jerome Clark.

  4. How Much Luck in Investing Success?

    Michael Mauboussin explains why humans tend to overweight the role of skill and underestimate the role of luck in investing success--and how we can correct for our perceptions.

5 Biases of 'Accumulator' Clients

Overconfidence and illusions of control, among other issues, can complicate the investing lives of accumulator-type clients.

Michael M. Pompian, 12/18/2014

This month's article is the 12th in a series called "Deep Dives into Behavioral Investor Types." This series is intended to help advisors create better relationships with their clients by deeply understanding the type of person they are dealing with from a financial perspective and adjusting their advisory approach to each type of client.

As we learned in the last series, there are four behavioral investor types (BITs): the Preserver, the Follower, the Independent, and the Accumulator. If you missed any of these articles, you can find them in my MorningstarAdvisor.com archive.

We will discuss each BIT in a series of three articles:

Part I will be a diagnosis of each BIT and discussion of its general characteristics.

Part II will be a deep dive into the biases of each BIT.

Part III will cover how to create a portfolio for each BIT.

This article is Part II of the Accumulator BIT. (Click here to see Part I.)

A Deep Dive on the Accumulator
The biases of Accumulators tend to be emotional--relating to how people feel--rather than focusing on cognitive aspects--relating to how they think. The biases of the Accumulator BIT are overconfidence, illusion of control, affinity, self-control, and outcome.

The author is a freelance contributor to MorningstarAdvisor.com. The views expressed in this article may or may not reflect the views of Morningstar.

blog comments powered by Disqus
Upcoming Events
Conferences
Webinars

©2014 Morningstar Advisor. All right reserved.