CFA Practice Question

There are 275 practice questions for this study session.

CFA Practice Question

An equity analyst working for a growth-oriented mutual fund has a tendency to misvalue the stocks of popular companies that she has previously recommended and the fund already owns. Her behavior is most likely consistent with which of the following biases?

A. Escalation bias
B. Prospect theory
C. Confirmation bias
Correct Answer: C

Confirmation bias refers to the bias of looking for information that supports prior opinions and decisions, which leads to a tendency to misvalue the stocks of generally popular companies.

User Contributed Comments 2

User Comment
praj24 Bad analyst! You should be ashamed of yourself
Inaganti6 Right now everyone covering Tesla is prone to this because of their god Elon musj
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