Flow of Dopamine leads to flaw in behavior

The above two words when cocktails together, An investor catches the route to destruction. While we tend to think bear markets as risky, true risks actually build up during periods of prosperity. During good times, investors bid up risk assets, becoming less discerning & more willing to pay any price to take a ride.

Risks compounds during such periods of bullishness, but this expansion in risk goes largely undetected because everyone is making money & Dopamine is flowing. (At the time of investing at excessive risk & high on Drugs – Dopamine levels are majorly same)

You very well know the risks & intellectually updated but your brain will do everything in its power to make sure that you don’t act accordingly. Coz Riding high on Dopamine is Cool & Adventures And that’s enough to materialize Risk.