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12 Cognitive Biases That Endanger Investors

Posted By Barry Ritholtz On March 17, 2013 @ 12:00 pm In Markets,Psychology,Rules | Comments Disabled

Before Todd Harrison created Minyanville [1], 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 [2].

 

 

Source:
12 Cognitive Biases That Endanger Investors [3]
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


Article printed from The Big Picture: http://www.ritholtz.com/blog

URL to article: http://www.ritholtz.com/blog/2013/03/12-cognitive-biases/

URLs in this post:

[1] Minyanville: http://www.minyanville.com/

[2] here: http://www.minyanville.com/special-features/random-thoughts/articles/12-Cognitive-Biases-that-Endanger-Investors/1/17/2013/id/47441?page=ful

[3] 12 Cognitive Biases That Endanger Investors: http://www.minyanville.com/special-features/random-thoughts/articles/12-Cognitive-Biases-that-Endanger-Investors/1/17/2013/id/47441?page=full

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