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Basic Question 2 of 7
A financial market participant purchased a stock for $20 per share. The stock goes up to $25 based on positive information. The new price is justified given available public information. However, the FMP sells the stock because he perceives it to be overpriced relative to the purchase price of $20. This individual is exhibiting a(n): A. conservatism bias
B. anchoring and adjustment bias
C. illusion of control bias
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I was very pleased with your notes and question bank. I especially like the mock exams because it helped to pull everything together.
Martin Rockenfeldt
Learning Outcome Statements
discuss commonly recognized behavioral biases and their implications for financial decision making
CFA® 2026 Level I Curriculum, Volume 6, Module 5.