Biases are part of the cognitive architecture of the brain. We can't avoid biases but we can think analytically and put speed bumps in our way to force us to check our assumptions. Biases covered included under the umbrellas of Attention biases, Memory bias, and Knowledge bias. Visit mentalmodelspodcast.com for more insights and watch our for forthcoming book November, 2019 on Bia$:A guide to improving your financial success.
Selection Bias can keep us hunting for what is most present on our mind, Waldo or the new Toyota we are planning to buy. Once we have committed to a decision we will see that specific brand everywhere. We are experiencing selection bias. Our brain is guiding us to what is most present on our...
Be the courageous investor! Fear linked to 3 things:
1: To little information
2: Potential Threat
Investing is linked to 2 things:
The Salience Bias is linked to fear and uncertainty and your primal brain functions in your amygdala. There are 2 types of...
Rationalization and thesis drift is akin to wrestling with muddy pigs... it’s slippery and you will lose $$$. For investors ”thesis drift” is the tendency to rationalize bad news and come up with fresh reasons to still like a stock. Don’t accommodate your viewpoint for a group of facts that you...