An exponential moving average (EMA) is a type of moving average that assigns more weight to the most recent data points. It is also known as a smoothed moving average or an…
Category: Behavioral finance
Upper band in stocks
The upper band in stock is a technical indicator that shows the highest price level that a stock can reach in a given period of time. It is often used by traders…
How is probability important for Risk and Return
If you are an investor, you probably know that risk and return are two sides of the same coin. The higher the potential return of an investment, the higher the risk involved….
What is Confirmation Bias ?
Confirmation bias is a term that describes our tendency to look for and interpret information in a way that confirms our existing beliefs or expectations. It is a type of cognitive bias,…
What is bias blindspot ?
DALL·E 2023-04-01 15.12.19 – What is bias blindspot river finance rohit sharma
What is bandwagon effect?
The bandwagon effect is a cognitive bias that causes people to do something because they see that others are doing it. It is a form of social influence that can affect many…
What is backfire effect ?
The backfire effect is a cognitive bias that causes people to reject evidence that challenges their beliefs, and to strengthen their support of their original stance. This means that showing people facts…
What is the Anchoring Effect ?
What is the Anchoring Effect? The anchoring effect is a cognitive bias that influences how we make decisions based on the first piece of information we receive. This information, known as the…
What is Mean reversion
Mean reversion is a financial theory that suggests that over time, the prices of assets tend to revert to their long-term average or mean. In other words, when the price of an…
What is Cognitive load?
Cognitive load is the amount of mental effort required to process information and make decisions. In finance, cognitive load can impact decision-making processes and outcomes, as individuals and organizations can become overwhelmed…