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Re: schiffy post# 12338

Thursday, 09/21/2023 7:34:39 PM

Thursday, September 21, 2023 7:34:39 PM

Post# of 13771
It's called regret avoidance.


What Is Regret Avoidance?

Regret avoidance (also known as regret aversion) is a theory used to explain the tendency of investors to refuse to admit that a poor investment decision was made. Risk avoidance can lead investors to hang on to poor investments too long or to continue adding money in hopes that the situation will turn around and losses can be recovered, thus avoiding feelings of regret.



Understanding Regret Avoidance

Regret avoidance is when a person wastes time, energy, or money in order to avoid feeling regret over an initial decision. The resources spent to ensure that the initial investment was not wasted can exceed the value of that investment. One example is buying a bad car, then spending more money on repairs than the original cost of the car, rather than admit that a mistake was made and that you should have just bought a different car.

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