loss/gain asymmetry, or selling winners and letting losers ride.
If you juego gratis bingo crack have a particular world view, or an investment view, you tend to believe the facts that fit your thesis and discount those that don't.
All financial journalists know this one.
As you may have noticed, this blog tends to be a bit bearish; I try to control this bias through numbers.Illusion of explanation or post hoc ergo propter hoc.Perhaps expecting rapid economic growth and very low interest rates is a current example of this syndrome in action.Ask "How fast were the cars going when they smashed into each other?" and the average guess will be higher than if you ask "How fast were they going when they bumped into each other?" I'm sure this plays a role when investors pick mutual.Mr Swarup gives an interesting example; people are shown film of a car collision and asked to estimate the speed of the vehicles concerned.But we want to do something (see hedonic treadmill) so we take our profits elsewhere.This is related to the illusion of control and hindsight biases how to deal blackjack from a shoe described above.(Well, we've got to write something.
Placing more weight on recent events than on past ones.
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If valuations were below average, I would be bullish (honest).Cognitive dissonance, or the vegetarian who wears leather shoes.That prompts other biases on our list.We like sure things and do not like "Knightian uncertainty" - situations where (unlike roulette) the odds are unknown.This may lead us to mistake situations of genuine uncertainty (ie, most of the decisions we face in life and in investment) for those where the odds are more established.Nor is a vague feeling much proof of your superior intellect; you may have thought tech stocks were overvalued at the start of the year, but did you make any money out of it?
When faced with conflicting beliefs or ideas, we unconsciously try to reconcile the conflict and regain our equilibrium through distortion.
Our answer to a question depends on how it is framed.
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The market went up/down because the non-farm payrolls were better/worse than expected.
We are never satisfied.