How To Deal With FOMO In Investing?

FOMO or fear of missing out is a term originally created to talk about the distress one feels at missing out on experiences and opportunities. However, FOMO is often used in investing to discuss how emotions such as impatience or envy influences an investor to make poor decisions.

Here is what you should know about FOMO, how to recognize it in investing and how to manage FOMO to keep it from negatively affecting your investing.

·        What is FOMO in Investing?

FOMO stands for ‘Fear Of Missing Out’. The meaning of FOMO is that, in the course of an arising fear about missing out on an opportunity or a chance, certain actions are performed. For instance, due to the fear of missing out on a good investment opportunity, investors may invest in a particular bonds or funds. The concept of FOMO has caused several investors to invest in ways that are not really recommended. In the financial market especially in mutual funds, index funds and exchange-traded funds (ETFs), the fear can be clearly seen when an investor experiences regret after missing out on a huge rally in the market.