How to Become a Goals-Based Investor

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Why You Should Be a Goals-Based Investor

Key Points

  • Traditional portfolio theory may not always align with an individual’s true objectives.
  • Goals-based utility theory bridges the gap between normative and behavioral finance.
  • Behavioral finance predictions do not provide specific guidelines for aspirational goals.
  • Goals-based investing involves using financial markets to achieve real-world objectives.

Franklin J. Parker, CFA, is the author of Goals-Based Portfolio Theory, published by Wiley.

Imagine for a moment that you owe a violent loan shark $10,000 by tomorrow morning but today you have only $7,000. Now suppose you visit an economist for help and ask, “What am I to do?!”

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Author : Editorial Staff

Editorial Staff at FinancialAdvisor webportal is a team of experts. We have been creating blogs about finance & investment.

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