Advertisement

(Ad Space)

Browse & Filter Biases

Showing 187 biases.

Not Enough Meaning

We tend to find stories and patterns even when looking at sparse data

Gambler's fallacy

Description

The mistaken belief that if something happens more frequently than normal during a given period, it will happen less frequently in the future (or vice versa).

Example 1:

An investor believes that because a stock has gone down for three consecutive days, it is "due" for an increase, ignoring that market movements can be random.

Example 2:

After a series of successful product launches, a company might become overly cautious, believing a failure is "due," even if market conditions remain favorable.

Advertisement

(Ad Space)