Fighting Anchoring Bias

Published on
March 19th, 2019
Duration
6 minutes

Fighting Anchoring Bias

Mental Game of Trading ·
Featuring Rick Bensignor

Published on: March 19th, 2019 • Duration: 6 minutes

Rick Bensignor, founder of the Bensignor Group, deconstructs one of the many common problems traders face on a daily basis: anchoring bias. He reviews the pitfalls that anchoring can bring, and discusses one way to take advantage of this bias in others.

Comments

  • CC
    Carlos C.
    25 March 2019 @ 15:21
    Good stuff!
  • BS
    Brian S. | Contributor
    20 March 2019 @ 02:33
    sounds like you are using an anchored VWAP!
  • PS
    Poyan S.
    19 March 2019 @ 20:10
    why did you cut him off. we wanted to the good stuff. please interview him and tell him to give us his secrets
  • SC
    Sejong C.
    19 March 2019 @ 12:51
    n-day MA. Is not this an anchor? A 200-day MA can be said to be the price that an average poor bastard bought 200 days ago. If the price challenges the 200-day MA, then that person is going to sell, relieved that his loss is now even.
    • RB
      Rick B. | Contributor
      19 March 2019 @ 23:11
      Hi Sejong. A MA is nothing more than the average close over X amount of days. In my opinion, in no way does it in any time frame represent where investors are collectively anchored — let alone the most important institutional ones. Moreover, a moving average value changes everyday; where institutional investors are importantly anchored does not move daily. Understanding when and where the smart money has positioned themselves is what has led me to be able to generate 75.1% return on invested capital for clients in 2017; and 24.3% in 2018. If you’re an institutional PM/trader or qualified high net worth individual and want more information, please see www.bensignorinvestmentstrategies.com For individual investors looking for a weekly market newsletter that reviews the US equity market, and positions you alongside institutional money managers and not against them, please check out www.InThrKnowTrader.com Thanks. -Rick