Essential 9 min read

The 5 cognitive biases that cost you money

Confirmation, recency, anchoring, sunk-cost, hindsight. Spot them in yourself before they fire a trade.

Confirmation bias — seeking only the evidence that agrees with a position you already want to take. Recency bias — overweighting the last few trades and forgetting your larger sample size. Anchoring — fixating on your entry price instead of what the market is telling you now. Sunk-cost fallacy — holding a loser longer because you've "already lost so much," as if more loss fixes that. Hindsight bias — looking at a chart after the fact and believing the setup was obvious, which erodes trust in your in-the-moment process.

You won't eliminate these — you'll just get faster at noticing when one is steering a decision.