While Investors Accurately Estimate the Past Performance of the Stocks

question 6

True/False

While investors accurately estimate the past performance of the stocks in which they invest,they hold overly optimistic beliefs about these stocks' future performance.

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Definitions:

Illusory Correlation

A tendency to assume an association between two rare occurrences, such as being in a minority group and performing negative actions.

Minority Group

A demographic group that is smaller in numbers within a larger society and is often subjected to differing treatment or discrimination.

Negative Actions

Behaviors or deeds that have harmful, destructive, or undesirable outcomes.

Illusory Correlations

The perception of a relationship between two variables even when no such relationship exists.