Do You Have a Herd-Like Mentality?
Humans have some horse-like tendencies. Before you get offended, let me explain. I recently went horseback riding for the first time and during that ride, I learned a lesson or two. We chose a private ride instead of a group ride, so there were just three horses including mine. Well, as we were riding, a large group with maybe 15+ horses and riders was passing us. They were going left, and we were going right - well, should have been going right. Unfortunately, my horse Laredo decided to go off course and go left with the group. My memory lapsed and I was unsure of what to do, I tried to do as I had been instructed, but Laredo did not want to turn around. Without getting too far into the weeds, what I learned that day, was that horses are social animals who exhibit herd behavior explaining why he wanted to follow the other horses. People are similar, often following the crowd. This tends to happen in many facets of life, but we also see this in the world of finance and investing. ...