Don’t Let The “Endowment Effect” Affect Your Trading Performance
You buy a stock, crypto, or forex pair. It starts falling, but instead of cutting losses, you hold on—convinced it will recover. This is the endowment effect in action—a cognitive bias that makes us overvalue what we own, even when logic says we should let go. In trading, this leads to: Holding losers too long (hoping for a rebound)…