easy · Certified Financial Planner General Principles

The Mendez family has been holding a losing investment for three years because they feel that selling it would 'make the loss real.'

Which type of behavioral bias are they exhibiting, and what is the standard intervention?

  1. A framing error that requires changing the presentation
  2. A cognitive error that can be corrected with a performance chart
  3. Anchoring bias that requires resetting the client's price expectation
  4. An emotional bias that may require the planner to adapt the plan

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