Loss aversion ↔ behavioral finance

Relations (1)

related 2.00 — strongly supporting 3 facts

Loss aversion is a core cognitive bias studied within the field of behavioral finance, as evidenced by its inclusion in academic research [1] and industry literature [2] that categorize it as a key distortion affecting investment decisions [3].

Facts (3)

Sources

The Impact of Cognitive Biases on Professionals' Decision-Making frontiersin.org Frontiers in Psychology 1 fact

referenceResearch in behavioral finance has identified several cognitive biases affecting financial decision-making, including overconfidence (Barber and Odean 2000, 2001; Chuang and Lee 2006; Glaser and Weber 2007; Odean 1999), loss aversion (Benartzi and Thaler 1995), the disposition effect (Boolell-Gunesh et al. 2009; Odean 1998; Shefrin and Statman 1985), home bias (Coval and Moskowitz 1999), regression to the mean (De Bondt and Thaler 1985), and herding behavior (Grinblatt et al. 1995).

The Influence of Behavioral Biases on Investment Decisions jmsr-online.com Journal of Management and Strategy Research 1 fact

claimExisting behavioral finance research often isolates specific biases like overconfidence, loss aversion, or herding, failing to account for how these cognitive and emotional distortions operate simultaneously in real-world investment scenarios.

5 Behavioral Biases That Can Impact Your Investing Decisions online.mason.wm.edu William & Mary Online 1 fact

referenceThe article '5 Behavioral Biases That Can Impact Your Investing Decisions' cites Investopedia for behavioral finance and confirmation bias, Schwab Asset Management for overconfidence and herd mentality biases, Mirae Asset Mutual Fund for loss aversion bias, and SmartAsset for anchoring bias.