Support our online development, and advance our onground research initiatives in free market economics, as we seek to showcase the brightest Next-Gen minds.
THE ME-P DISCLAIMER: Posts, comments and opinions do not necessarily represent iMBA, Inc., but become our property after submission. Copyright © 2006 to-date. iMBA, Inc allows colleges, universities, medical and financial professionals and related clinics, hospitals and non-profit healthcare organizations to distribute our proprietary essays, photos, videos, audios and other documents; etc. However, please review copyright and usage information for each individual asset before submission to us, and/or placement on your publication or web site. Attestation references, citations and/or back-links are required. All other assets are property of the individual copyright holder.
By Staff Reporters and A.I.
SPONSOR: http://www.CertifiedMedicalPlanner.org
***
***
OVERCONFIDENT INVESTING BIAS
Overconfident Investing Bias happens when we believe we can out-smart other investors via market timing or through quick, frequent trading. This causes the results of a study to be unreliable and hard to reproduce in other research settings.
Example: Data convincingly shows that people and financial planners/advisors and wealth managers who trade most often under-perform the market by a significant margin over time. Active traders lose money.
Example: Overconfidence Investing Bias moreover leads to: (1) excessive trading (which in turn results in lower returns due to costs incurred), (2) underestimation of risk (portfolios of decreasing risk were found for single men, married men, married women, and single women), (3) illusion of knowledge (you can get a lot more data nowadays on the internet) and (4) illusion of control (on-line trading).
***
***
MORE:
- Video
- 1. Herding
- 2. Confirmation Bias
- 3. Overconfidence Effect
- 4. Loss Aversion
- 5. Endowment Effect
- 6. Status Quo Bias
- 7. Familiarity Bias and Home Country Bias
- 8. Survivorship Bias
- 9. Recency Bias
- 10. Tracking Error Regret
- 11. Anchoring Bias
- 12. Mental Accounting Bias
- 13. Hindsight Bias
- 14. Narrative Bias
- 15. Irrational Escalation of Commitment and Sunk Cost Fallacy
- 16. Optimism Bias
- 17. Outcome Bias
- 18. Law of Small Numbers
- 19. Self-Attribution Bias
- 20. Availability Bias
- 21. Authority Bias
- 22. Restraint Bias
- 23. Information Bias
- Conclusion
COMMENTS APPRECIATED
Like and Subscribe
***
***
Share this:
Filed under: "Ask-an-Advisor", CMP Program, economics, Experts Invited, finance, Financial Planning, Funding Basics, Glossary Terms, mental health, Portfolio Management | Tagged: bias, brokers, Ethics, finance, financial advisors, financial planners, Investing, mental health, Portfolio Management, stocks, traders, wealth managers, what is bias?, what is overconfidence? | Leave a comment »
The Leading Business Education Network for Doctors, Financial Advisors and Health Industry Consultants 