Investor psychology refers to the emotional and cognitive factors that influence how investors make decisions in the financial markets. It encompasses various biases, such as overconfidence, loss aversion, and herd behavior, which can lead to irrational investment choices. Understanding these psychological aspects can help investors recognize their own tendencies and improve their decision-making processes. The study of investor psychology is crucial for both individual and institutional investors. By being aware of how emotions can impact investment strategies, investors can develop more disciplined approaches. This awareness can lead to better risk management and ultimately enhance long-term financial performance in the context of stock markets and investment portfolios.