Optimism bias

A behavioural bias where someone believes that they are less at risk of a negative event happening to them compared to the rest of the population. An example might be traders in financial markets who have made substantial profits when investing in the stock market and who under-estimate the probability / risk of a downturn in share prices. Linked to the hot hand fallacy - which in short means "whatever is currently happening will continue to happen forever."

© 2002-2022 Tutor2u Limited. Company Reg no: 04489574. VAT reg no 816865400.