INVESTMENT TRAPS- Anchoring Bias Describes the tendency to only rely on top piece of information and getting anchored to it while decision-making. It causes a lot of oscillation and hinders the decision-making ability. For instance- You had a good return on a stock in the past, your perception on the future returns would be similar, even when the prices might take a dive. Escape the Trap by: 1.Acknowledging the bias. 2.In-depth research and analysis. 3.Delaying the decision. 4.Dropping down the anchor.
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