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No matter how well a trader does in the market, they can always find traders online than have done even better. But the better a trader has done in achieving huge gains, the more dangerous it may be to follow his or her recommendations.
Investors suffer from a long list of psychological biases that can adversely impact their success in the market. One of the most dangerous biases for investors is a phenomenon known as survivorship bias.
What Is Survivorship Bias? Survivorship bias is the tendency for people to cherry-pick people or strategies that successfully made it through a selection process and ignore all those that failed. People tend to focus on these survivors, even if they survived in large part due to luck rather than viability.