Question

What two types of investor irrationalities does an investor that use the last month's return to determine the attractiveness of stocks suffer from?

Select one:

a. Forecasting error and sample size neglection

b. Mental accounting and overconfidence

c. Overconfidence and conservatism

d. Regret avoidance and acting according to prospect theory

e. Framing and Forecasting error

Answer 1

What two types of investor irrationalities does an investor that use the last month's return to determine the attractiveness of stocks suffer from?

C)Overconfidence and conservatism

D)Overconfidence and conservatism

this is the main reason for the attractiveness of stocks.