A Short Guide for Financial Advisors in Helping their Client’s to Better Understand Common Flaws in Behavioral Investing

A Short Guide for Financial Advisors in Helping their Client’s to Better Understand Common Flaws in Behavioral InvestingWritten by: James Orth

A Short Guide for Financial Advisors in Helping their Client’s to Better Understand Common Flaws in Behavioral Investing

1


Table of ContentsCover Page.................................................................................................................................................................... 0

Introduction................................................................................................................................................................. 1

First of all What is Behavioral Finance and Behavioral Investing?.....................................................1

What we Know so far From Advisors’ Experience......................................................................................2

Our “Old” way of Thinking?...................................................................................................................................2

What one of the Best Investor in Modern History has to say About Investing..............................3

Prepare, Plan, and Pre-Commit to a Strategy................................................................................................3

Why it is Painful for you and your Clients to go Against the Crowd?.................................................4

Re-Investing When Terrified................................................................................................................................ 5

Why Being Overly Optimistic is Probably a Bad Thing?...........................................................................6

Overconfidence kills an Investor’s Portfolio?...............................................................................................7

Why Does Anyone Listen to Cramer and the Other so Called “Experts?”.........................................7

Forecasts and how This Leads to Anchoring.................................................................................................8

Uncovering Critical Information from the Cloud of Noise.......................................................................9

How to Overcome your Client’s Views on Sunk Costs and Being Loss Averse...............................9

Beating the “Status Quo” and the “Endowment” Effect..........................................................................10

While you Cannot Control Everything as an Advisor, you can Control the Process of Recommending Investments to Clients........................................................................................................11

Final Words............................................................................................................................................................... 12

Resources................................................................................................................................................................... 12

A Little bit about your Author of this Article..............................................................................................13

2


IntroductionTo help understand the psychological behavior of people we will need the help from

James Montier and his book titled The Little Book of Behavioral Investing: How not to be your own worst enemy. James (I will refer to Mr. Montier by his first name, not to be confused by the author of this article) currently works with GMO, a global investment management firm committed to providing sophisticated clients with superior asset management solutions and services. James gives details into behavioral finance using similar case studies to show similarities of common biases that also exist when investing. The book references those that are starting out in investing and those that consider themselves professionals and gives insight into the often-overlooked aspect of our investment decisions, our self. James also goes on to reveal some of the most common psychological barriers showing how emotion, overconfidence, and numerous other biases lead us to making poor investment decisions.

This guide also use articles from the websites of Think Advisor, Adhesion Wealth, Investopedia, and other example articles have written articles on this important topic for Financial Advisors. These articles explain how advisors should know their clients innate tendencies towards investing so that they can maximize their clients returns on their portfolios while providing confidence that the Financial Advisor has a plan in place for better or for worse.

First of all What is Behavioral Finance and Behavioral Investing?

Many Advisors have heard of the Efficient Market Hypothesis (EMH) where the theory assumes, for the most part, that investors behave rationally and predictably. However, there are times that anomalies in the markets cannot be based on rational behaviors. Investopedia explains that “the most rudimentary assumptions that conventional economics and finance makes is that people are rational wealth maximizers who seek to increase their own well-being.” This explains that there should not be other factors that influence how people make economic choices.

One irrational decision is those that purchase lottery tickets, with the chance of winning being “roughly 1 in 146 million, or 0.0000006849%, for the famous Powerball jackpot” (Investopedia). Yet people still contribute despite the odds not being in their favor.

3


“That on average IPO’s underperform the benchmark by 21% three years on because they’re born on excitement. They’re born in irrational exuberance, and people tend to do IPOs, of course as we all know, when the market is relatively elevated or there’s a lot of popular sentiment” (Think Advisor 10).”

Behavioral Finance/Investing can be best explained by academics such as James Montier who look to psychology to account for the irrational and illogical behaviors which cannot be explained through the traditional approach from a theory such as EMH, which assumes ever investor is rational.

What we Know so far From Advisors’ ExperienceFrom the website Think Advisor the two commentators “Widger and Daniel Crosby,

behavioral finance experts, and founders of consulting firm IncBlot and co-authors of the new book Personal Benchmark: Integrating Behavioral Finance and Investment Management.” They also conducted a survey and “found out that 77% of financial advisors are talking to their clients about behavioral finance, which is a great thing.” From Adhesion Wealth, another website dedicated to financial advisors, they also did a study where “93% of advisors believe that individual investors make irrational investment decisions” (Adhesion Wealth). Not to say that these Advisors will not make such mistakes, but it is important for Advisors to know what the multitude of biases and irrational behaviors exist and incorporate them into their practice so that they can properly educate and appropriately invest their client’s accounts that suits their needs.

Our “Old” way of Thinking?This is where we kick off some of the topics that are covered in James Montier’s book on

Behavioral Investing. First up is the evolution factor that our brains are designed for the environment that we faced over 150,000 years ago on the African savannah, not the industrial age of 300 years ago. It takes over thousands or hundreds of thousands of years for species, especially given our complex nature, to evolve to changes to our environment. Unless we know how to speed up evolution, which may very well be the case someday, we currently have not fully adapted to this new modern age and therefore we act as though we are still swinging in the trees with a banana in hand.

4


James used the concept of Star Trek to further explore how we think, saying that there are two different ways of how we process our thoughts. The first is your X-system, the emotional approach to decision making. The other is the C-system, the more logical approach to problem solving. Our X-system has engrained emotions into how we think, as James describes, that we will still react to a snake snapping at us behind a glass window as a natural defense mechanism. We know that the window will protect us, our logical C-system thinking, yet we still jump in fear, our emotional X-system thinking. We ultimately need the X-system to make quick decisions for if we relied completely on the C-system we would question everything to the point of impairment. Yet looking at Investing James well go on to say that the most reasons why investors perform poorly is because they were thinking with their emotions, not with their logic.

What one of the Best Investor in Modern History has to say About InvestingWarren Buffett, one of the most prominent “value investors” of our era, said that,

“Investing is simple but not easy” (Behavioral Investing). The simple concept in investing that you buy assets for less than their intrinsic value and then sell when they are trading at or above their fair value. If everyone listened to Benjamin Graham and regularly attended Warren Buffett’s annual shareholder meeting than investment managers would at least earn the same return on the market. Turns out this is not the case as this excerpt from James’ book discusses.

“Over the last 20 years, the S&P 500 has generated just over 8 percent on average each year. Active managers have subtracted 1 or 2 percent from this, so you might be tempted to think that individual investors in equity funds would have earned a yearly 6 to 7 percent. However, equity fund investors have managed to reduce this to a paltry 1.9 percent per annum (return)” (Behavioral Investing).”

Prepare, Plan, and Pre-Commit to a StrategySome of us turn out to be bad at imagining how we will react in the “heat of the

moment.” This inability to predict future behavior under emotional strain is a bias called the empathy gap . After a big hardy meal we could not imagine being hungry again, and on that same note that you should never go to the grocery store while hungry, as you tend to over buy. The same would go for investors before the dot.com crises who saw

5


enormous gains on the NASDAQ and grew hungry for big gains. So thinking falsely that past performance does guarantee you a lot of money, they invested their life savings. Then see in a couple months span of all their money going down the bottomless abyss.

They then saw we are also prone to post-phoning plans as we all have a tendency to procrastinate . While some like the idea of having everything done at the last minute, psychologists have found “that imposed deadlines are the most effective” (B.I.).

Both of these behavioral pitfalls of the empathy gap and procrastination can be beaten by the power of pre-commitment. After all “Perfect planning and preparation prevent piss poor performance” (Behavioral Investing). Sir John Templeton, investor and mutual fund pioneer, used to make his buy decisions well before a sell off occurred. Sir John knew that it would be impossibly difficult to buy when particular stocks are down 40 percent. With buy orders though it made it easier to buy when faced with massive sell offs and removed emotions, the X-system, from the situation.

As clients like to be involved in investing, advisors can coordinate companies that the clients are interested in investing and place buy orders prior to any eventual sell offs. With 90% or more invested in accordance to a strategic or tactical investing strategy, and with 10% or less for more speculative investments, that could be a similar strategy to Sir Johns investing. This way the client that wishes to be engaged in investing can do so and the advisor can feel safe that he/she did so during a time of irrational exuberance that should benefit the client.

Why it is Painful for you and your Clients to go Against the Crowd?

The biggest example of “herd-mentality” was described above as being the dot.com crises where investors were employing buy and sell strategies in pursuit of the newest and hottest investment trends. We know this can be a very powerful force as it contains the social pressure of conformity to be like other investors that are making gags of money. An Advisor may be pressured by clients to go along with the trend of either sectors or particular stocks in the hopes of gaining what those investors have already achieved. Advisors may feel compelled to do so because if the client invests and makes money, then the client will be happy. If he/she does not, than the Advisor can

6


justify his/her poor decision making that many other investors and even Advisors were led astray as well.

“As sir John Templeton put it, that it is impossible to produce superior performance unless you do something different from the majority. Keynes, world renown economist, pointed out the central principle of investment is to go contrary to the general opinion on the grounds that if everyone agreed about its merits, the investment is inevitably too clear and therefore unattractive” (B.I.).”

As Advisors we need to not only keep ourselves from this herd-mentality but also educate them about the irrational exuberance with going with the crowd. As somewhat stated in the quote above Advisors should invest less in equities in times of exuberance and more in times when investors cannot click the sell button fast enough. As such recommending more stable income earning bond funds that perform well even during a crisis would be good investment advice. Also, when the market topples you can recommend to clients the importance of moving funds more to equities to take advantage of the once again exuberance but of those that sell securities below their intrinsic value. This would need to have been discussed prior to any investing as it is important in teaching clients how the market works and to think logically when it comes to investing and not with your emotions.

Re-Investing When TerrifiedThe paragraph above touched on this briefly as Sir Templeton said that “The time of

maximum pessimism is the best time to buy and the time of maximum optimism is the best time to sell” (Behavioral Investing). Another famous saying coming from Buffett that you should be fearful when others are greedy and greedy when others are fearful. This notion is that trouble is opportunity for you and your clients.

From the Behavioral Investing book again, the author shows how a study that has those with brain damage to parts of their brain where they feel fear have no problem in flipping a coin when they have a higher probability of earning money than losing money. While this many hinder them in certain ways in life, in re-investing this plays out well for them. This does not mean that we should only take on clients that have brain damage to the parts of their brain where the feel no fear but that we should educate the power of other people’s irrationality and how you can help in the recovery of companies along with making money along the way.

7


From (Think Advisor 10) Crosby, mentioned before as a behavioral finance expert, created a 0-to-100 index of market sentiment called the Irrationality Index. He said that the index reached its lowest point in history during the recent financial crises where it got down to 5 out of the potential 100. Investors were thinking rationally that their investments were indeed overvalued. He goes on to say that “if you had gone in at that 5, by this point you would have about doubled your money” (Think Advisor 10).

Why Being Overly Optimistic is Probably a Bad Thing?From Live Science, a website dedicated to science in health, planet Earth, space, and

others, says “that studies suggest optimists live longer and enjoy better health than pessimists” (Live Science). Even CBS has commented on people’s illusory superiority where “in a classic 1977 study, 94 percent of professors rated themselves above average relative to their peers” (CBS). Yet if equity investors compared themselves to the S&P 500 benchmark to their portfolio then they would have vastly underperformed so instead of 8 percent they contributed 1.9 percent, as quoted from the “What one of the Best Investor in Modern History has to say About Investing” section. Not only would these equity investors be underperforming but they will also be living long enough to make their mistakes even longer.

Spencer Davidson of General American Investors recalls, “that we’re (wealth managers) paid to be cynical and that a big part of success in investing is knowing how to say no” (Behavioral Investing). Think Advisor 10 also comments that if an Advisor or client becomes excited about an investment, that it’s probably a bad idea. One Advisor was getting phone calls for his clients about the recent Alibaba debut and whether they should buy it. Have these clients known that IPO’s underperform the benchmark by 21% consistently over a three year span, which explained before are being born from excitement.

Advisors, or in this case Wealth Managers, should analyze stocks, mutual funds, ETF’s, all in the same manner and should let only the logical parts of the brain lead them in recommending sound advice rather than their biased redden emotions.

8


Overconfidence kills an Investor’s Portfolio?James conducted a study of 74% of the 300 professional fund managers and found that

they deliver above average job performance. We all know that only 50% can be above average and this shows that fund managers seem to believe that they are not only good at their job but they are also overconfident in their skill set.

Researcher Terrence Odean found that,

“overconfident investors/traders tend to believe they are better than others at choosing the best stocks and best times to enter/exit a position. Unfortunately, Odean also found that traders that conducted the most trades tended, on average, to receive significantly lower yields than the market” (Investopedia).

Advisors need to know where they get their advice, as in the next section will cover the so called experts that Advisors or their clients may listen to which may promote underperforming. We need to follow mutual funds or ETF’s that we know have reputable managers that have been experience along with a low turnover in their funds. When it comes to your older investors it is important for Advisors to know that risk is the probability that you won’t have the money you need to do the things that matter most to you. Advisors want their clients to fill confident in our skill sets but that does not mean that you are the best Advisor and should be content with a laissez-faire investing strategy. What Advisors should be doing is continually learning more and most importantly, learning from our mistakes.

Why Does Anyone Listen to Cramer and the Other so Called “Experts?”

Flipping through the channels on the T.V. around many have encountered Jim Cramer and his style of fast talking and extreme exuberance towards investing, but does he add any value? According to Wikipedia Cramer’s career from his hedge fund over his 14 years there had an average annual return of 24%. Yet this is the same “expert” That recommended buying Bear Sterns, Morgan Stanley, Lehman Brother, and Merrill Lynch, some years before they all went down in 2008.

From Think Advisor 10 they equate forecasting as a tool that should be left to the weatherman/weatherwoman as we are not very good at forecasting and what the market is

9


going to do. Those that do more trades tend to fair worse than those that trade less. From “1991 -1996 the market returned just under 18 percent annually, yet those that traded frequently, 21.5% earned a 12% return, and those that traded the least managed to earn close to the 18% annual return after fees”(Behavioral Investing).

For an Advisor this should be noted in the mutual funds and ETF’s that we recommend, along with individual stocks for the more hands on and higher net worth clients. We should focus our strategy to keeping a low turnover rate for the funds that we recommend. During our client meetings we can focus on other parts of our clients lives such as, changes since the last meeting. Comparing a benchmark that you set that compares what they are doing now and if that is on track for their financial goals. Lastly, covering the performance of your client’s accounts as it pertains to their investment goals and balance only as necessary.

Forecasts and how This Leads to AnchoringAnalysts are always forecasting numbers on companies but many of these “experts” as

well are wrong with 2 years earnings report, being wrong on average of 94% and a 12 month time horizon being wrong around 45% according to evidence provided in James’ Behavioral Investing book. The reason why they can be so off is that a model contains many moving parts with sales, costs, margins, taxes, and so on that it makes it difficult to predict each one and their connection to each other. These analysts only make money if their forecast was different from the consensus adding a new dimension of complexity to the problem.

Yet Advisors and clients want to know what the experts think with their forecasts and many will find forecasts that best fits our own preconceived notion of how a company will perform in the future. When given a number we tend to cling to it, even subconsciously, a trait known as anchoring as James points out. When shopping for an engagement ring many consider that it should be two months’ worth of salary. Sounds like the jewelry industry bamboozling young men into spending more than what they want, to the enjoyment of both their fiancé and the jewelry industry.

Just because a stock of a company has fallen from a high point and your client is calling and asking whether to invest, does not mean that it automatically is trading at a discount. To understand if it is below its intrinsic value is to look at the fundamentals of what can cause a stock to drop so much before thinking of this stock as a door buster deal.

10


One measure of forecasting that can be more beneficial is doing a reverse Discounted Cash Flow (DCF) model. For instance James did performed this analysis on Google, Apple, and RIMM which were all pricing at 40 percent annual growth every year for the next 10 years. Comparing this to historical distribution of the 10-year growth rates achieved by all firms show that 99.99% only managed to grow at 22 percent annually over 10 years. So these companies are expected to do twice as well as any other company in history? That seems unlikely and as James shows they lost 53, 52, and 63 respectively over the course of 2008. Whenever a client brings up a company of interest we could then run this reverse DCF to calculate if their expected growth is too extreme and implausible as James notes in his book.

Uncovering Critical Information from the Cloud of NoiseIs more better? We might all say yes when it comes to Thanksgiving with food and

drinks. Yet as James points out that as more information becomes available, two things happen. First, accuracy flat-lines, and Second is the degree of confidence expressed in a given forecasts increase with more information being provided, which confidence can cloud judgment. From Advisor 10 comes this sentence that “more importantly than this entire onslaught of information that they’re getting from financial news networks is how they affect those in managing their own behavior.”

James is a big proponent of value investing and says that his key measures which I think every Advisor should note in their valuation is first, is the security undervalued or overvalued? Second is if their balance sheet shows stability or them going bust? Lastly is the company’s capital discipline and what the management is doing with the cash I am giving them and if they are driving up risk.

How to Overcome your Client’s Views on Sunk Costs and Being Loss Averse

The “sunk cost” fallacy is a tendency to allow past unrecoverable expenses to influence current decisions. We “tend to hang onto our views too long simply because we spend time and effort in coming up with those views in the first place” (Behavioral Investing). What is important about sunk costs is that you should not let this past information affect your decision in the present. The same can be said about a losing stock and that you want to ride out the poor performance of the stock in the hopes that it at least comes back to the point that you

11


originally bought it at so that you can sell it for little to no loss. This would be due to our over optimism and overconfidence biases that we all have when it comes to investing.

Terry Odean, who was talked about from the section titled “Overconfidence kills an Investor’s Portfolio?” explored individual habits of 10,000 investors in a brokerage account from 1987 to 1993. “Investors tend to hold losing stocks for a median of 124 days and winning stock for 102 days and that investors were 1.7 times as likely to sell a winning stock than a losing stock” (Behavioral Investing).

This is not just for those individual investors as mutual fund managers were 1.2 times as likely to sell a winning stock rather than a losing stock. The best performing funds happen to be those with the highest percentage of losses realized. The disposition effect, selling winner too early and keeping losers, and also shows signs of investor’s loss aversion. That people strongly prefer avoiding losses than acquiring gains. Studies suggest that “losses are as much as twice as psychologically powerful as gains. Loss aversion was first convincingly demonstrated by Amos Tversky and Daniel Kahneman" (Wiki Loss Aversion).

One way Advisors can easily sell loser stocks is by having either a “guaranteed stop loss” or a “put option” that charges a premium but sells losers when the market tanks or individual securities perform poorly. It can be hard to contact clients with individual holdings of different funds and individual stocks in time to make a difference from those underperforming funds and securities. Although, this might be an expensive strategy and time consuming strategy to constantly be renewing these guaranteed stop losses and put options. This is part of a pre-commitment strategy that an Advisor can develop with his/her client that is a portfolio management tool that is based on the principle of risk/return.

Beating the “Status Quo” and the “Endowment” EffectNow that we know that many are willing to hold onto losers and sell their winners,

James gives a scenario where you are looking at your account where all your stocks have lost 30 percent in value within the last three months. You are so overwhelmed that you take your dog out to do its business and at the same time your nephew is messing with your computer trying to find a game but ends up selling all of your positions. Would you buy them back? Most people though would not buy those loser stocks back, says James from Behavioral Investing.

This scenario shows that investor’s inaction is represented in the status quo bias, that we are indifferent with the current progress, or we would have sold all our stocks already. The

12


other is the endowment effect “that once you own something you start to place a higher value on it than others would” (Behavioral Investing).

For Advisors this is important as some clients hold onto, particularly certain stocks that sometimes they recommended in buying which the Advisor backed up their decision to buy. If it has performed poorly the Advisor should know to sell the security given a pre-conceived notion that if an investment losses X percentage than it should be sold. The Advisor should make it clear that if a particular stock got down to a certain level than it should be sold so that the endowment effect does not hinder a client’s decision in whether to sell or hold.

While you Cannot Control Everything as an Advisor, you can Control the Process of Recommending Investments to Clients

Good Outcome Bad OutcomeGood Process Deserved success Bad breakBad Process Dumb luck Poetic justice

This how James breaks down how decisions are based on either a good process or a bad process, but either one is subject to a different outcome of also good and bad. Advisors want to be in the far left box where are good process and good outcome lead to our client investment accounts to do well. There is also the very likelihood that bad process could have a good outcome which this can be a major downfall for an Advisor. This one time success of a client’s portfolio many cripple other future clients as eventually our luck will eventually run out. Clients place their judgment on their outcomes rather than the quality of the decision and the experience of the Advisor with recommending investment advice, known as outcome bias .

James states that focusing on process frees us up from the worrying about aspects of investment which we really cannot control, such as return. With a sound process we maximize our potential to generate consistent long term returns. However, this will not help you in the short term and during periods of underperformance where clients will be pressuring you to change your process. To counteract this is the need to educate clients early on about investing and all that it entails. From not following the crowd, to not chasing the highest return stocks and funds, to let go of securities when they underperform, amongst many others described in

13


this book. As Sir John Templeton said, “the time to reflect on your investing methods is when you are most successful, not when you are making the most mistakes” (Behavioral Investing).

Final WordsInvesting is not for those that are prone to biases and irrational thinking. This is probably

why many choose not to invest and why Advisors still have a job. To make this work for clients though it needs to be tailored to each individual/married/domestic partnership clients that you serve. As an Advisor you want to maximize your possible usefulness and create confidence with the client about your skills and the process with how you recommend investing advice. One of the strongest pieces of advice to Advisors may be that they teach each of their clients about behavioral investing, that thinking with one’s emotions are the very downfall that one can be susceptible to when a financial crises comes knocking on the door of their portfolio.

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

Adhesion Wealth: http://www.adhesionwealth.com/blog/2013/11/22/an-rias-guide-to-behavioral-investing-webinar/

CBS: http://www.cbsnews.com/news/everyone-thinks-they-are-above-average/

Eric Tyson: http://www.erictyson.com/articles/20080922#.VHs4LYvF-y4

Investopedia Detailed: http://www.investopedia.com/university/behavioral_finance/

Live Science: http://www.livescience.com/32338-is-optimism-good-for-you.html

Seeking Alpha: http://seekingalpha.com/article/586351-book-review-the-little-book-of-behavioral-investing-how-not-to-be-your-own-worst-enemy

Think Advisor: http://www.thinkadvisor.com/2014/10/30/how-behavioral-finance-can-boost-goals-based-inves

Think Advisor 10: http://www.thinkadvisor.com/2014/10/06/10-commandments-of-investor-behavior?page_all=1

14

http://www.thinkadvisor.com/2014/10/06/10-commandments-of-investor-behavior?page_all=1

http://www.thinkadvisor.com/2014/10/06/10-commandments-of-investor-behavior?page_all=1

http://www.thinkadvisor.com/2014/10/30/how-behavioral-finance-can-boost-goals-based-inves

http://www.thinkadvisor.com/2014/10/30/how-behavioral-finance-can-boost-goals-based-inves

http://seekingalpha.com/article/586351-book-review-the-little-book-of-behavioral-investing-how-not-to-be-your-own-worst-enemy

http://seekingalpha.com/article/586351-book-review-the-little-book-of-behavioral-investing-how-not-to-be-your-own-worst-enemy

http://www.livescience.com/32338-is-optimism-good-for-you.html

http://www.investopedia.com/university/behavioral_finance/

http://www.erictyson.com/articles/20080922#.VHs4LYvF-y4

http://www.cbsnews.com/news/everyone-thinks-they-are-above-average/

http://www.adhesionwealth.com/blog/2013/11/22/an-rias-guide-to-behavioral-investing-webinar/

http://www.adhesionwealth.com/blog/2013/11/22/an-rias-guide-to-behavioral-investing-webinar/


Value Walk : http://www.valuewalk.com/james-montier-resource-page/

Wikipedia Loss Aversion: http://en.wikipedia.org/wiki/Loss_aversion

A Little bit about your Author of this ArticleHell everyone this is James Orth, having graduated from the University of Texas at San Antonio in the year 2015 from the honors college with a Bachelors of Business Administration in Finance, Magna Cum Laude. I have been fascinated with finance and in particular personal finance for years before writing this article. It is amazing how well off some few individuals are on this ill spoken subject, and others who need a lot of help but find that it is in their best interest to solve it on their own. That is why I wish to radically change the field of Financial Advising and give those I work with knowledge which will become power to change their lives, and just as importantly, their loved ones’ lives. I thank my readers for reading this article on a subject that I am very passionate for and to those advisors I too hope you will radically change the world of Financial Advising.

(This paper was written to fulfill Business Honor requirements with the help of Professor of Finance, Ronald Sweet)

15

http://en.wikipedia.org/wiki/Loss_aversion

http://www.valuewalk.com/james-montier-resource-page/

Documents

A Short Guide for Financial Advisors in Helping their Client’s to Better Understand Common Flaws in Behavioral Investing