Manage Investments Through Logic, Not Emotion
Professor Daniel Kahneman from Princeton University won the 2002 Nobel Prize in Economics for proving that humans are more than two times more likely to try to avoid loss than they are to attempt gain.
When you apply that non-rational human nature to investing, it results in lower returns on your portfolio. It’s emotionally difficult to rebalance an investment portfolio when it means selling some of your winners to add more of something that may not be doing as well.
But, when you rebalance methodically, your portfolio is rewarded with both higher long-term returns and better protection through downturns.