An Evaluation of CDY Going Forward, page-5

Your explanation of the sentiment is a commonly held one, Dentie.

Behavioural finance theory claims that investors would take alternative action if they fully recognised what causes the sentiment to be held. It’s point is that where a conscious decision is made that there is value in holding and just waiting it out then the appropriate rational disclosure would be ‘Hold; Held’.

Relevant characteristics the theory defines are:

‘Anchoring’ is a behavioural bias in which the use of a psychological benchmark (such as a purchase price) carries a disproportionately high weight in a market participant’s decision making process.

‘Sunk Cost Fallacy’ refers to the tendency for investors to irrationally follow through on an activity that is not meeting their expectations rather than cut losses and move on to a potentially more rewarding investment.