The field guide
Your Brain on Markets
Four reads on the mistakes your own mind will try to make: why losses hurt double, why you only see confirming evidence, why crowds feel safe at exactly the wrong moment, and why you sell winners and marry losers.
- 01Loss aversion: why losing 100 hurts like 200Losses register roughly twice as loudly as equal gains. That asymmetry, not stupidity, explains most panic selling — and it can be engineered around.
- 02Confirmation bias: your personal yes-manOnce you own a position, your brain quietly switches from detective to defense lawyer. Here is how to catch it filing evidence for one side only.
- 03Herding: the crowd feels safest at the topFollowing the crowd is ancient, rational-seeming, and the engine of every bubble. The dangerous part is that it works — right up until everyone is in.
- 04The disposition effect: selling flowers, watering weedsInvestors reliably sell winners too early and cling to losers too long. The cause is not analysis but accounting — the mental kind — and it has a receipt trail.