Anchoring
TheoryDefinition
The tendency to over-weight the first piece of information encountered when making a decision. In investing: anchoring on purchase price (refusing to sell below it), on round numbers (S&P 5000, BTC $100K), or on a favorite analyst's target.
Cure: pretend you don't own the position and ask whether you'd buy it today at the current price. If no, it's usually a sell.
Cure: pretend you don't own the position and ask whether you'd buy it today at the current price. If no, it's usually a sell.