Anxiety and the Stock Market

Today, I would like to write and hopefully start a discussion about a type of anxiety that I have never written about or conducted research on: money-related fears. The reason is that I have always been very interested in the stock market and investor behavior (and I thoroughly enjoy stock-picking and investing myself) -- yet I have never come across or read anything about investment-related fear behavior that was written from a scientific-empirical perspective. This is all the more surprising given how many people directly or indirectly participate in the stock market these days.

When people worry about money, they are typically apprehensive about two things: not making enough of it and not losing what they already have. People who actually do not have much money typically worry about making (or having) enough mnoney to make ends meet, whereas people with a lot of money typically worry about not losing what they already have. In view of rising stock markets all over the world. it is the second type of concern that I am particularly interested in today. The fear of most investors about the stock market is typically tampered by their hopes of making a small (or big) fortune by investing in particular types of individual companies or mutual funds. Money managers always warn that an investor faces two "internal enemies": excessive fear and excessive hope ("greed"). Both can lead to irrational behavior and cost the investor dearly both in terms of emotional turmoil and actual financial losses. My question is: Is there anything in the anxiety research literature that would help us understand specific money-related fears and investor behavior. Likewise, is there anything that we can learn and apply from clinical research and practice to help people deal with money-related fears in general and investment-related fears in particular -- and maybe even make them more successful investors?

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