Behavioural finance studies the psychology of financial decisions and is especially important in the investment arena. It explains how investors can sometimes act irrationally or from an emotive viewpoint, with ingrained and unhelpful biases in their approach.

If investors understand these better it is likely they will make better decisions, avoid painful financial errors and reduce their propensity to suffer losses.

Learning about behavioural finance is an important step for investors, even for experienced investors. The most relevant area for investors starts with an appreciation of how biases can often play a big part in investment decisions.

These biases are often hard-wired within us, with valuable benefits in our everyday life.

However, when it comes to money matters, they can have the opposite effect.

Understanding and spotting these biases when they arise can make a positive difference to outcomes.