Being Prone to Confirmation BiasWe are all prone to confirmation...

Being Prone to Confirmation Bias

We are all prone to confirmation bias. We tend to look for confirming, rather than disconfirming, evidence. Most of us have a really bad habit of only paying attention to information that agrees with our existing beliefs. We also have a tendency to form our views first, and then spend the rest of the day looking for information that makes us look right. Our natural tendency is to listen to people who agree with us. Because it feels good, it feels all warm and fuzzy, to hear our opinions reflected back to us.

We choose the news that reflects our views and opinions. However, it is disastrous for investment decision-making. Instead, we should be looking for disconfirming information and disconfirming evidence.

So, start looking for information that actually might disprove your ideas rather than confirm what you want to do. That is how you try to guard against this bias.