Confirmation Bias

We let confirmation bias take control of our mind by only seeking out information from sources that agree with our pre-existing beliefs.  Conversely, we tend to ignore and dismiss information (= disconfirming evidence) which tend to disprove our initial impressions. It’s the tendency to interpret the glass…

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Endowment Effect

Endowment Effect is the tendency to fall in love with what we own and makes us resist change.  Or in other words, this is the tendency to consider something you own to be worth more than it would be, if you didn’t…

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Self-Serving Bias

Most of us have a good reputation with ourselves. You associate all of your financial successes with skill, but all your financial failures with bad luck or the “unfair” market.  Rather than admitting and learning from your mistakes, you ignore them, bury…

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Loss Aversion

Social scientists have proven that—emotionally—a loss “weighs” at least twice that of a similar gain.  That might be great for aspiring body-builders, but not so great for us regular Joes. It’s the actual gaining or losing and your feelings about it that…

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