Recallibility vs regret minimization

AnalystForum

Are these two the same?

Valores

No - Recallibility is the case which you remember happened in past and you think it might again happen in future.

RM - One doesn't solve the decreasing stock and keep it until it goes up.

liangfeng

What's the diff between Recallability and Representativeness?

infinitybenzo

Representativeness is building on momentum. A good stock in the past will continue to be a good stock in the future.

Recallability is sayign I remember the crash of 1987 and i am fearful anytime the market goes down 100 points because i have flashbacks.

Chuckrox

bidder Wrote:
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> Thanks CFAdreams
>
> So Recallability can link to loss aversion
> behaviour.
> Representativeness can lead to price
> inefficiency.
>
> Oh and here are the 6 psychological "traps":
> Anchoring
> Status quo
> Confirming evidence
> Overconfidence
> Recallability
> Prudence

The 6 traps you mentioned are primarily traps related to forecasting, correct?

zwjy

^Economic Forecasting traps

NakedPuts2011

pupdawg82 Wrote:
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> RM - One doesn't solve the decreasing stock and
> keep it until it goes up.

You just defined "loss aversion" - keep the losers..

Regret minimization is when an investor invests 50/50 stocks and bonds to avoid regret, in case one asset class outperforms the other. This behavioral trait can lead to avoidance of variety => less diversification..

Recallability is a trap.... RM is a behavior..

bodhisattva

I had a hard time remembering this acronym with the topic it goes with, but figured this much out:

Traps! O-craps!

bpdulog

bidder Wrote:
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> Representativeness can lead to price
> inefficiency.

I thought all of these behaviors mentioned in the Behavioral Finance section lead to price inefficiency.. not just this one..

susana

what is the best way / source to practice these traps / behaviors?