'Smart Money' Chases Performance Too

A recent article in the Wall Street Journal discusses the many redemptions of Bill Ackman's Pershing Square hedge fund. What is interesting is that those requesting redemptions are institutions.

We all like to use mental shortcuts to help us in daily life. As investors, one of our short cuts is to simply follow the "smart money". Hey, if it's good enough for JP Morgan , it's good enough for me!

Click the image to watch the one minute video below to learn more about institutions selling low, and what question investors need to ask themselves so they don't make financial decisions based on performance.

Related: Index Funds Can Lead to Worse Performance