We accommodate emotional biases and mitigate cognitive. Could someone remind me what does it exactly mean?
I remember that we can get rid of cognitive biases with education, but what about emotional?
This comes up when you get a question pertaining to adviser/client relationship. An adviser should educate a client to mitigate cognitive baises but they need to accommodate emotional biases because education generally doesn’t fix these and attempting to change them could ruin the relationship.
Ok, I now that but what does ACCOMMODATE mean in this context? What extacly should they do to accomodate?
Accommodate means they work around them so that the client is comfortable. This is related to the level of client wealth. The less wealth they have the more the adviser needs to try and mitigate some of the emotional biases. Higher wealth means the adviser can accommodate more emotional errors
Yes, I know the details. I did’t understand what exactly they have to do accomodate. Thanks Sanalyst, your explenation helped a lot.
accomodate, think of it like a bed and breakfast. The client stays at your house for a night.
lol
Cognitive, you can prove through facts or data, emotional you cannot. Think about an argument with your girlfriend, if you can prove she is wrong, show her and educate her. If she is emotionally invested in the belief, forget it and just go with it, no amount of arguing will work.
You adapt in the case of :high wealth or emotional bias
You moderate in the case of : low wealth or cognitive bias.