Regret-aversion bias

by | Feb 27, 2019 | General | 0 comments

The regret-aversion bias is related to another emotional bias we have discussed recently, i.e., the loss-aversion bias.

Have you ever avoided to make a decision out of fear that it will turn out to be a bad decision? Yes? Then you are a victim of the regret-aversion bias. But do not worry, you are not alone!

regret-aversion bias

Since we are speaking about trading and investing here, how could the regret-aversion bias affect our results? An example is when you bought shares of a company, the price rises, and you do not want to sell because the price may keep going up. So if you sell too early, you will feel bad.

If you held some bitcoins before December 2017, and you are still holding them, either you are keeping them for the long term, or you may have suffered the regret-aversion bias.

As for other biases, the key to overcome it is to follow a system telling you when to buy and when to sell before you even start investing. There are many systems of course, but this is another story. So stay tuned, and subscribe to the newsletter to avoid missing useful articles where some of such systems may be presented:)