I can't begin to describe how damaging impulsiveness is to investment performance. To act impulsively is to act quickly on a poorly thought-out investment decision. The operative word here is fear, either fear of a loss, or fear of missing out on a gain. When you operate on the basis of emotions, poor decisions are often the result.

Furthermore, even if the result turns out favorably, a dangerous precedent has been set in your mind, and the next deviation from the plan will be much easier to rationalize. Impulsiveness can quickly lead to a 'trading' type mentality, and can quickly become addictive. Market Action quickly replaces Underlying Value as the driving force behind investment decisions, and very few investors have the emotional tools to play that game. I don't do it with my clients.