Before Todd Harrison created Minyanville, he was an options trader at Morgan Stanley, eventually becoming President of Cramer Berkowitz, where he toiled as head trader at Jim Cramer’s hedge fund.

Todd has an excellent analysis of the various biases that endanger investors.

Here is the full list:

1. Confirmation Bias
2. In-Group Bias
3. Gambler’s Fallacy
4. Post-Purchase Rationalization
5. Neglecting Probability
6. Observational Selection Bias
7. Status-Quo Bias
8. Negativity Bias
9. Bandwagon Effect
10. Projection Bias
11. The Current Moment Bias
12. Anchoring Effect

Check out his explanation and descriptions here.

 

 

Source:
12 Cognitive Biases That Endanger Investors
Todd Harrison
Minyanville January 17, 2013
http://www.minyanville.com/special-features/random-thoughts/articles/12-Cognitive-Biases-that-Endanger-Investors/1/17/2013/id/47441

Category: Markets, Psychology, Rules

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One Response to “12 Cognitive Biases That Endanger Investors”

  1. [...] Ritholtz noted here that Wall Street veteran and Minyanville founder Todd Harrison addressed those 12 biases through [...]