标题: overconfidence will lead to... [打印本页] 作者: LBriscoe 时间: 2011-7-11 19:29 标题: overconfidence will lead to...
underestimating risk but over or underestimate a event impact on a stock?作者: oneboy 时间: 2011-7-11 19:29
Tough....I would say underestimate as event impact is a risk and you will underestimate risks and therefore underestime event impacts.作者: Chuckrox 时间: 2011-7-11 19:29
it depends you can be overconfident that a netflix is overpriced or underpriced作者: mik82 时间: 2011-7-11 19:29
^^^ indeed....if you are overconfident that a signifigant negative event will occur and smash the stock price, I would say you overestimate event risk.
If you are all bulled up on a name you will underestimte it.作者: lcw77 时间: 2011-7-11 19:29
a short career,,,,,,,作者: Valores 时间: 2011-7-11 19:29
would say OVERestimate (just my rough guess)
I know some overconfident guys from the business and that really helps to have those poor performers in mind to the exam, also for Type I error ;-)
they short (!) the index one week after fukushima and wonder why they hit the rebounce ;-)
in essence (practice not CFAI) they have no idea whatsoever is going on and use a lot of ceteris paribus excuses, too, i.e., they say their trade was right but this one event did change everything. Anoterh example: a trade from me (would have deliverd 50% plus in some 2-3 weeks) did not go through because mr. overconfident knew of one larger bid side (so he overestimated this "event").
So they have not the b....ls to stem the vola until the profit materializes which supports the narrow confidence intervals
