Tag: herd mentality
Mind Over Market: Dodging the Investment Illusions of the Representativeness Heuristic
In the multifaceted world of investing, there’s a cognitive trickster at play – the Representativeness Heuristic – that often twists our perception with its illusionary magic. This fancy term might sound like something out of a Hogwarts spellbook, but it’s actually a psychological wizardry that plays a significant role in investment decisions, especially in the…
The Herd Mentality in Trading: Why You Should Avoid the Bandwagon Effect
Have you ever done something just because everyone else was doing it? In trading, this is called “Herd Mentality” also known as “The Bandwagon Effect.” It’s when we follow what other investors are doing, thinking they must know best. But just because a lot of people are buying or selling a certain stock, doesn’t always…