Chapter 6 Terms Flashcards
1
Q
Founding father of Modern Portfolio Theory
A
Harry Markowitz
1
Q
Representativeness
A
Investors make quick decisions without regard to probability distributions or real factors
2
Q
Myopic Loss Aversion
A
When investors take a view of their investments that is strongly focused on the short term, leading them to react too negatively to recent losses, at the expense of long-term benefits
3
Q
Clustering Allusion
A
Tendency to believe that short term price patterns are repeatable over subsequent short-term periods
4
Q
Hindsight Bias
A
When investors recall positive outcomes but fail to remember the negative one
5
Q
Overconfidence Bias
A
When investors overestimate their ability to identify mispriced securities
6
Q
Loss Averse
A
Investors make decisions that minimize feelings of regret
7
Q
A
