Anchoring Bias

Anchoring Bias is the tendency to overweight importance of first information that we lean. People anchor their views to past data and are reluctant to adjust their views to new information.

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Anchoring leads to inertia. This causes investors to under react to news, which keeps prices below their fair value. Once price trends do finally develop, they remain strong for some time as prices aim to reach their fair value

Anchoring Bias