Sometimes our emotions can lead us to undermine our investment strategies. However, if you’re able to recognize the following all-too-human tendencies, you may be able to make more thoughtful and successful investing choices.

• Individuals are strongly motivated to avoid losses.
• When evaluating investments, individuals generally use their purchase price as an anchor, evaluating performance based on that number rather than more objective criteria.
• Following impulses in response to market news may satisfy the human urge to act, but frequent trading typically doesn’t correlate with successful long-term performance.

The key to more successful investing is reducing the opportunity for human impulses to undermine your goals. To guard against making emotional investment decisions, investors can adopt the following behavioral strategies that may help minimize impulsive actions and potentially increase portfolio returns.

• Allocate properly—By having an investment mix that appropriately reflects a goal’s time horizon—rather than jumping from one investment to another to chase recent gains and move away from recent losses—individuals can better maintain a plan based on their goal, not recent market activity.
• Invest regularly—Market timing is an inexact science, at best. That's why it's a good idea to invest the same amount on a regular basis. Doing so means investors buy shares during market ups and downs, so more shares are purchased when prices are low and fewer shares are purchased when prices are high. Remember that this strategy, known as systematic investing, cannot assure a profit or protect against loss in a declining market. Since such a plan involves continuous investment in securities regardless of fluctuating price levels, investors should consider their financial ability to continue purchases through periods of both high and low price levels.
• Avoid information overload—A constant stream of financial news can trigger the human bias toward action—regardless of whether that news is relevant (for example, short-term news may not be the best indicator of what your long-term strategy should be). So it’s important to filter information—keeping it in context—to minimize the influence of emotion over investment decisions.
• Rebalance periodically—Because markets are constantly changing, investors may want to consider revisiting their asset allocation from time to time and rebalancing, if necessary, to return to their original targets.

Remember, having a steady, disciplined investment strategy can help you avoid acting impulsively and taking actions that could keep you from successfully reaching your goals.