i can’t seem to wrap my head around the difference between representative bias vs availability bias. They both seem to be putting weight toward what you remember happening in the past. Can someone explain the difference?
I find that section to be the hardest section in behavior finance since a lot of things are so similar but certain keywords trigger a different answer. I would recommend seeing if schweser has something on youtube that talks about it. Sometimes they have free videos online.
Rep Bias - Using something as reference to make a decision on something else that isn’t related.
Avail Bias - going off your own memory what you can recall
and rep bias shows in base rate neglect (ignore base probability) and sample size neglect (stress on small sample size).
Availability bias leans towards what is readily available in your memory or easy to get to make the decision.
All these names are clear as mud…
bfry! How’s the studying coming? Are we going to knock this out in one shot or what? 