Several layers of beliefs interact with investors’ biases and preferences to ultimately influence behaviour. Among the most thoroughly researched investor beliefs are those about the future (e.g. expectations about economic growth, or returns for different markets or securities, and beliefs about the likelihood of extreme negative market events).

The first paper looks at the relationship between individual investors’ beliefs about the future and their actual portfolio behaviour and composition. Initially published in 2019 and updated in September 2020, includ...