Please wait...

Herding

‘Hi, I came across this really nice video on the Franklin Templeton website. Check it out!’

When investors rely on following the rest of the market participants while making an investment decision, it is called “herd mentality”. This herd mentality makes irrational buying seem rational just because “everyone else is doing it”. It may also create a bubble around an asset class and ultimately lead to a massive slide like the one we saw in 2008. One must avoid following a herd mentality and make rational investment choices to meet one’s financial goals. Here is a video which explains this behaviour and its side-effects very lucidly. Have a look !