Zhu Su highlights behavioral risks associated with selling at market peaks
Zhu Su, co-founder of Three Arrows Capital, has cautioned that selling assets at perceived market peaks may carry higher behavioral risks than selling during periods of decline.
According to NS3.AI, Zhu Su noted that successfully exiting at the top of a market can create a psychological effect of overconfidence. This may lead traders to re-enter positions prematurely, potentially increasing overall risk exposure.
He also referenced a case involving Garrett and the “10/10 event,” suggesting that strong performance and realized gains may contribute to more aggressive or less disciplined trading behavior. While the example is speculative, the broader point highlights how emotional responses to success can influence future decision-making.
From a market perspective, this commentary reflects a common behavioral finance principle: psychological factors such as confidence, fear of missing out, and recent success can significantly affect risk management and trading discipline, sometimes more than market conditions themselves.