Investing isn’t just about picking the right stocks or timing the market—it’s about managing emotions and staying disciplined. Many investors let fear, greed, or overconfidence influence their decisions, leading to costly mistakes. “The biggest risk to investing success is our own behavior,” says David Waldrop, a Certified Financial Planner® and owner of Bridgeview Capital Advisors, Inc. in El Dorado Hills. “It’s not just about what the market does—it’s about how we respond to it.”
Behavioral finance studies how psychological biases impact financial decisions. Traditional theories assume investors act rationally, but in reality, emotions often drive financial choices. Recognizing these biases can help investors make smarter decisions.
Overconfidence is one of the most common pitfalls. “If you’ve had a few wins, it can be easy to believe you have a special ability to pick stocks,” Waldrop says. “But often, success is due to market trends rather than personal skill.” This can lead to excessive risk-taking and poor diversification.
Hindsight bias causes investors to believe past events were more predictable than they were. “Many people claim they ‘knew’ the housing bubble would burst in 2008, but very few actually saw it coming,” Waldrop explains. This false sense of predictability can lead to frustration and misguided decision-making.
Confirmation bias is another common trap—investors seek information that supports their existing beliefs while ignoring contradictory evidence. “If you love a company and its stock starts declining, you might only look for positive news to confirm your belief that everything is fine,” says Waldrop. “But ignoring warning signs can be costly.”
Herd mentality, or following the crowd, often leads to investment bubbles and crashes. “This was a big factor in the cryptocurrency boom,” Waldrop says. “Many people jumped into Bitcoin and other digital assets simply because everyone else was investing, without fully understanding the risks.” This behavior drives stock market bubbles, where prices rise beyond reasonable valuations—only to crash when reality sets in. “People tend to buy when the market is high because it feels safe, and they sell when it’s low because it feels scary,” Waldrop notes. “But that’s the opposite of what successful investors do.”
Waldrop’s expertise in investor psychology comes from over two decades in financial services. He earned a degree in political science from Cal Poly, but after graduation, he pivoted from law or teaching to finance. “I’ve always been interested in politics, financial markets, and current events,” he says. “Becoming a financial advisor felt like the perfect fit.”
After earning his securities licenses, he became a Certified Financial Planner® in 2003. He later took over an independent firm in Woodland before becoming the sole owner of Bridgeview Capital Advisors, Inc. in 2012, relocating the firm to El Dorado Hills. “My wife, Jennifer, was my biggest inspiration and supporter in becoming a business owner,” he says. Jennifer works as a teacher’s aide and track coach, and Waldrop has also coached youth sports, including the Oak Ridge Junior Trojans football program.
Despite his deep ties to the community, most of his professional work initially reached people outside El Dorado Hills. “A few years ago, I shifted focus to ensure those in my own backyard knew I was available as a local resource for their financial planning needs,” he says.
Financial success isn’t about predicting market swings—it’s about staying committed to a well-thought-out strategy. Waldrop emphasizes his local client's long-term thinking over short-term reactions. “Making emotional decisions in the short term rarely leads to good outcomes,” he says. “I help clients focus on the big picture.”
One of the biggest mistakes investors make is trying to time the market. “Most people assume we’ll put them on a strict budget and hold them accountable for every dollar spent,” Waldrop says. “That’s not the case. We don’t dictate spending; we simply show the financial impact of choices.” For example, if a client wants to take a dream vacation, Waldrop helps them see how it fits into their financial plan without jeopardizing their long-term goals. “Wealth isn’t built solely on high income; it comes from smart financial planning,” he explains.
Waldrop believes that understanding behavioral finance is crucial to making better investment decisions. “You don’t have to be an expert to make smart financial choices, but being aware of your biases is key,” he says. Markets will always be unpredictable, but investors can control their reactions. “Most factors affecting the market are outside your control, but you can control your behavior,” Waldrop advises.
While numbers and market trends play a role in investing, financial security comes from aligning money with personal values. Waldrop encourages investors to think beyond returns and consider what financial success means for their lives. The true power of investing, Waldrop explains, lies in its ability to create opportunities. “At the end of the day, investing is a tool—it’s about creating freedom, options, and the ability to live life on your terms.”
David Waldrop, CFP®
Bridgeview Capital Advisors, Inc.
With more than 20 years of experience in financial services, David Waldrop specializes in investment management, financial planning, and tax strategies. He helps clients break down financial goals into manageable steps, celebrating progress and making necessary adjustments along the way. His firm offers a seamless and efficient onboarding process for new clients, leveraging the latest technology for secure portals for document uploads and e-signatures. While he’s always happy to meet clients in person, he also offers virtual meetings, ensuring expert guidance with convenience and flexibility.
Waldrop is more than just a financial advisor—he’s a trusted partner who genuinely cares about his clients’ success. Whether he’s helping someone plan for retirement, save for a child’s education, or navigate market uncertainties, his goal is to bring clarity and peace of mind. His love for his craft and his community shines through in every conversation, making financial planning feel less overwhelming and more like a journey toward a secure and fulfilling future.
Waldrop believes that understanding behavioral finance is crucial to making better investment decisions.