Academic studies conclude that investors are far from uniformly ‘homo economicus’. Investment behaviour is influenced by compelling factors other than rationality. The example below identifies that investment behaviour should recognise emotion as well as arithmetic.

Tulips, South Seas, and Mississippi: short, true tales on three infamous manias in investing history.

For much of the past decade these quarterly reviews have contained references to the scourge of market and economic volatility, as we’ve been passing through an unusually disruptive investment and economic era. Thankfully, in 2017 volatility dissipated, (at least temporarily!). This quieter period can be illustrated by...