Twitter is the best global platform to experience and study a huge array behavioural finance biases, because they are on display in such a prevalent manner!
Which behavioural finance pitfalls can you identify with? Here are some common examples /1

Overconfidence/ self attribution bias- (“stock x is up 50% in 3 days, I was pounding the table on this last week, kudos to everyone taking my advice”, inserts meme)

Herd Mentality- (popular tweeter: “I like this stock”....Herd: “never heard of this one, I like it too”) /2

Illusion of Control bias- (“my newsletter made a stock pop 20%”)...unlikely given institutional flows are 85% on said stock and I doubt institutions are reading a twitter newsletter /3

Anchoring bias- (“stock X is 30x sales, but I like the company, wait a minute stock X was 50x sales a few months ago, it’s so cheap now”)...... no consideration to the fact that the historic 3y average ev/sales is 12x

Framing bias - (“finance professional with 50 followers posted financial analysis on a stock that I don’t understand, I’ll ignore. Wait Mr. X whos new to investing but has 10k followers just said he loves this stock but he doesn’t confuse me with complicated analysis, BUY”) /5

Narrative fallacy- (“I use stock X product all the time, this product has massive demand, I expect a big quarter”) /6

Outcome bias- “wow investor X made 300% in 2020, I’ll copy him/her” (no consideration given to their process that led to those returns, do they themselves copy others, do they take excessive risk, how did they do in a normal market?) /7

Cognitive Dissonance bias - (“stock X lost a significant customer today, damn the stock is down 10% today, oh it’s in the price now, it will be back to highs soon”)....tendency to ignore newly acquired info as conflicts with previous positive views /8

Recency bias- (“growth stock X is up 200% in 2020, it’s still growing at 40% so it will continue to rally” ...no consideration given to normalised returns in years before 2020 or valuation underpinning 40% future growth, only consideration is price action /9

Hindsight bias- (stock X falls 20%.....“sure stock X was due a pullback, it was trading way above 200ma, it was always gonna happen”...... so did u sell & profit? “No I didn’t, but it was obvious the pullback was gonna happen ”) /10

Confirmation bias - (“my stock is up 20% this week; here’s this article and that article to confirm my beliefs that I am right”...same stock drops 20% a few weeks later, but no articles are forthcoming from investor) /11

Every investor is guilty of psychological biases.
Identifying which biases you display in your investment process, can help detect excessive or undue risk you are taking & can significantly improve your investment process by removal of such psychological negative tendencies. /END