Disposition Effect Is the Tendency of Individual Investors to ________

question 45

Multiple Choice

Disposition effect is the tendency of individual investors to ________.

• A) trade too much based on the mistaken belief that they can pick winners and losers better than investment professionals
• B) buy stocks that have been in the news, advertised more, have very high trading volume, or recently had extreme (high or low) returns
• C) put too much weight on their own experience rather than considering historical evidence
• D) hold on to stocks that have lost value and sell stocks that have risen in value since the time of purchase

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Definitions:

Schizophrenic Disorders

A group of severe mental disorders characterized by disordered thoughts, perceptions, and emotions, leading to detachment from reality.

Maladaptive Behaviour

Maladaptive Behaviour is any type of behavior that inhibits an individual's ability to adjust healthily to particular situations.

Expressed Emotion

Expressed Emotion is a measure of the family environment that is based on how much criticism, hostility, and emotional over-involvement are directed at the patient by family members.

Critical

In the context of thinking or analysis, it refers to the objective evaluation and judgment to form a reasoned opinion or decision.