TD Waterhouse presents MoneyTalk

Patricia Lovett-Reid is the host of MoneyTalk, a national prime-time television program on personal finance, airing every Monday at 8:00 p.m. ET on the Business News Network (BNN).

The Little Book of Behavioral Investing — How Not to Be Your Own Worst Enemy

Patricia Lovett-Reid reviews the book by James Montier

When it comes to investing, emotion always comes into play. Fear and greed are the most obvious of these. This book outlines strategies from some of the world's savviest investors on how to tackle behavioural biases that can compromise investment returns.

James Montier shows the importance of doing your research and choosing your investments in a "cold" rational state, when nothing significant is happening in the markets. This focus on process, rather than outcomes, is critical to investing, according to Montier, as it allows you to focus on things you can control.

By following the strategies outlined in this book, you can learn to overcome your own worst instincts. To quote one of my colleagues, "You would be irrational if you did not read this book."

The information contained herein is current as of May 17, 2011.

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