Disposition effect

As a disposition effect behavioral economics is the inclination of investors to divest those shares whose value has risen, and to keep those whose value has declined. In this case, losses are about twice as strongly felt as gains. This phenomenon of Verlustabneigung was first described by Amos Tversky and Daniel Kahneman.

The economic effect of this disposition describe Ingo Wilms / L. Busche as follows:

• See also: anchor effect

Weblink

• WINAND BY PETER LANDENDORFF: The fatal fidelity to loser stocks. In: FAS. April 21, 2012

• Business Psychology