What is Cognitive Bias in Finance?
Cognitive bias in finance is the process of making decisions based on flawed mental shortcuts. It's like trying to navigate a maze while blindfolded, but with more money.
Here are some common biases that will lead you down the path of financial ruin:
- Loss Aversion: The Fear of Losing Money
- Anchoring: The Art of Setting Unrealistic Expectations
- Availability Heuristic: When You Think You're Right, But You're Actually Wrong
- Illusion of Control: Because Who Needs Actual Control, Anyway?
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