A Simple Strategy for Getting Rid Of Confirmation BiasVW Staff
A Simple Strategy for Shaking Confirmation Bias – a short nugget from Barry Ritholtz followed by one of the papers cited
One of the most insidious cognitive biases affecting investors and traders is confirmation bias. Once we hold a particular view, we tend to prefer processing information that fits with that view. What’s worse is that, because of our bias blind spots, we commonly recognize biased thinking in others, but not in ourselves. We know from research in psychology that fresh inputs and mental flexibility are essential to creativity of thought. When we become locked in confirmation bias, we cease to innovate.
So how is one to overcome not only confirmation bias, but our own bias blind spots? One way is to develop the discipline of reading articles and posts that have been selected for their quality by experienced, independent agents. This is why I make it a habit to read selections curated by Abnormal Returns and The Big Picture. At various times, the editors of those blogs, Tadas Viskanta and Barry Ritholtz, have highlighted posts from my TraderFeed blog. It’s been my observation that, with rare exception, they have selected posts that I myself found to be among my more informative offerings.
Full article via Barry Ritholtz, more below