An Alternative Investing Future?

Hurley, Mark P.; Fuller, Tom
September 2001
Journal of Financial Planning;Sep2001, Vol. 14 Issue 9, p50
Academic Journal
This article focuses on the risk tolerance of investors. For many years, an unspoken fear of market watchers and advisors was how clients would react if they incurred losses in their portfolios. Behavioral research has consistently shown that clients usually suffer two-and-a-half times the pain from losing money than from the joy they feel making it. However, over the years, this attitude has changed. Although they still suffer and agonize over losses, they seemed to be less frustrated over losses. In other words, in the short term, clients seemed to be satisfied with near-zero returns so long as the market is crashing. However, in the long term they expect that their advisors will find a way to make their money grow.


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