Psychological Traps vs. Behavioral Biases

CFA Level III
#1

If a short response question asks for a psychological trap, how exact does one have to be? It seems to me that there is a lot of overlap between the two. For instance, question 3 on the 2007 AM asks to identify 2 psych traps for each party, Nultione and Hyatt. For Hyatt, I put representativeness, but the answer was recallability. My explanation was basically the same as the answer key. Do you think that would fly on the exam?

#2

yah

#3

Nope. Unfortunate. Unless the answer is anchoring or overconfidence, we will have to be very specific in distinguishing between the biases and psychological traps.

#4

No, representitiveness is not a “psychological trap” as defined by the text. You might get partial credit for getting the explanation right, though. The 6 psychological traps are “CORPAS” Confirming Evidence Overconfidence Recallability Prudence Anchoring Status Quo

#5

What does ‘prudence’ do?

#6

Prudence tapers results i believe

#7

Prudence results in excessive conservatism – need to reduce “regret.”

#8

ozzy609 Wrote: ------------------------------------------------------- > No, representitiveness is not a “psychological > trap” as defined by the text. You might get > partial credit for getting the explanation right, > though. > > The 6 psychological traps are “CORPAS” > > Confirming Evidence > Overconfidence > Recallability > Prudence > Anchoring > Status Quo Or ASs CORP as someone else suggested.

#9

Schweser says there is overlap in the readings, between the definitions of various terms, and that credit should be given for either one. But that’s their opinion, so who knows.

#10

mwvt9 Wrote: ------------------------------------------------------- > ozzy609 Wrote: > -------------------------------------------------- > ----- > > No, representitiveness is not a “psychological > > trap” as defined by the text. You might get > > partial credit for getting the explanation > right, > > though. > > > > The 6 psychological traps are “CORPAS” > > > > Confirming Evidence > > Overconfidence > > Recallability > > Prudence > > Anchoring > > Status Quo > > Or ASs CORP as someone else suggested. THanks mwvt9, now I’ll never forget this. Like Bannisja’s ‘unit’ root and ‘Dickey’ Fuller test last year. Classic.

#11

Psychological Traps are So Crap Status Quo Overconfidence Confirming evidence Reacallability Anchoring Prudence

#12

i’ll add SO CRAP to my never-ending list of lists thanks - now it’s etched in my brain forever…