15 Short-Cuts and Biases That Lead to Bad Investment Decisions
“The whole problem with the world is that fools and fanatics are always so certain of themselves, and wiser people so full of doubts.”
— Bertrand Russell
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Those doubts arise from past experience grappling with difficult decisions and oftentimes getting the decision wrong.
Just why people make mistakes when choosing between courses of action has been the life work of Harvard Business School Professor Max Bazerman, one of the most respected experts in managerial judgment and personal biases, and the author of “Judgment in Managerial Decision Making” (John Wiley & Sons, 2005).
In this well-respected work Professor Bazerman describes several reasons why we make mistakes when trying to make decisions where outcomes are uncertain. He even includes a chapter on errors investors are prone to make.
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