Introduction

Sometimes an oft-repeated axiom, maxim, or cliché has at least a small piece of truth to it. Others make sense and are true in some situations, but not others. 

The world of finance and investing is no exception to the coining of popular axioms and the misconceptions that can go along with them—especially when it comes to trading stocks. Traders are well-supplied with frequently repeated sayings that speak to perceived data patterns. And they must work to gut-check choices plagued by their own emotional biases.

On this episode of Financial Decoder, host Mark Riepe is joined by Nathan Peterson, director of derivatives analysis, to unpack a handful of these more ubiquitous expressions around investing and trading and give insight into how much weight they should carry in your decision-making.

To read the study Mark references on the connections between risk tolerance and visceral pain, check out "Relating the Visceral Factor of Pain to Domain-Specific Risk Attitudes" in the Journal of Behavioral Decision Making.

Financial Decoder is an original podcast from Charles Schwab. For more on the series, visit Schwab.com/FinancialDecoder. 

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The information provided here is for general informational purposes only and should not be considered an individualized recommendation or personalized investment advice. The investment strategies mentioned here may not be suitable for everyone. Each investor needs to review an investment strategy for his or her own particular situation before making any investment decision. 

All expressions of opinion are subject to change without notice in reaction to shifting market conditions. Data contained herein from third-party providers is obtained from what are considered reliable sources. However, its accuracy, completeness, or reliability cannot be guaranteed. 

Examples provided are for illustrative purposes only and not intended to be reflective of results you can expect to achieve.

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