Myopic Loss Aversion, the More You Look the Worse it Gets 😨

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Loss Aversion and Myopic Loss Aversion. PLEASE LIKE, SUBSCRIBE AND SHARE THIS VIDEO TO SUPPORT US. Let’s look at the effect of myopia and loss aversion on risk taking. Loss Aversion; The pain of loss is a stronger emotion than the joy of gain. People would rather not lose money than gain money. Traders and investors don’t want to cut their loss and ultimately their losses keep getting bigger. The urge to avoid losses is often detrimental. As traders we need not to be not too loss averse but at the same time we need to manage the risk.

How to avoid being your own worst enemy when investing

Myopic Loss Aversion – the more you look the worse it gets. This is the double whammy; as traders and investors we are constantly looking at our positions particularly if our positions are red. Take charge of the situation; what was your plan initially and take action and responsibility. Don’t be irrational.

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