Wednesday, August 13, 2014
Outcome bias - avoid it
HBR blog mentions outcome bias, the belief that random outcomes are the result of your choices. The odds can be in your favor but that does not mean that you will always win, and you cannot change your behavior the first time you lose. The real discipline in trading is letting the odd do their work. Patience is sticking with your decision rules while the evidence builds on its success or failure.