It’s from Schweser mock exam 1. Does client has congnitve or emotioanl bais? I thought it’s congnitive bias because client shows the illustion of control (he believes personal role at the company led to the large increase in value of his stock options). However, schweser solution shows emotianal bais… What do you think?
"PM learned his client was a middle-level corporate finance executive for a large corporation. The client is 55 years old, and his wife is 52. Both are in good health. In the meeting the client spent considerable time bragging about the successful strategies used in the corporation and how his personal role at the company led to the large increase in value of his stock options. When the corporation began to pursue international diversification, the client shifted a large part of his wealth into emerging market funds and tripled his money. He then further leveraged these gains with call options. He expects Simms to continue these excellent returns. "