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Understanding Anchoring Bias in Finance by toabhishekpal is a document available to read on EtoBox.
Anchoring and adjustment bias refers to the tendency for people to rely too heavily on an initial piece of information offered (the "anchor") when making decisions. Studies show people do not adjust sufficiently from their initial anchors even when presented with new information. For investors, this can mean being anchored to current market levels when making forecasts, sticking too closely to original earnings estimates for companies, or basing future return forecasts too closely on past returns. Being awa
- Author
- toabhishekpal
- Language
- EN