India, March 2 -- When conversations turn to investing, the risks most often cited are external. Inflation, elections, oil prices, interest rates and geopolitical tensions tend to dominate the list. These are visible forces, measurable and widely discussed. They exist beyond the individual and, for that reason, feel easier to analyse. Yet over time, it becomes clear that the most persistent threat to long-term wealth is rarely external. It sits much closer, in the realm of reaction, mood and impulse.

Markets, by their nature, fluctuate. Prices rise and fall, often in response to factors that are unpredictable or only fully understood in hindsight. What is more predictable, however, is how investors respond to these movements. When market...