We know a few institutional investors who ought to turn their seldom-used conference rooms into meditation, er, mindfulness centers. A Danish neuroscientist has sorted out that one answer to resolving behavioral biases lies in the insular cortex. That lobe is the part of the brain that is linked to the level functioning of our bodies, including thought processes. In his research, Ulrich Kirk found that rational decisions dominate emotional decisions when we train ourselves to be relaxed about the stimulus-response cycle. While this conclusion may seem intuitive, the study was validated using functional magnetic resonance imaging with meditators and control subjects. Importantly, the findings counter prevailing views that behavioral biases, such as those related to investment choices, are hard to overcome. ■
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