Loss Aversion: Why We Hold Losers and Sell Winners

A $100 gain feels great, but a $100 loss feels much worse due to loss aversion. This core concept in behavioral science and psychology of money shapes our everyday financial decision making. Manage your risk management by understanding how cognitive biases impact your investment choices. Chapters: 00:00 Why losses hurt more than gains 00:30 Prospect theory: reference points & steeper loss curve 00:55 Decision weights (CPT): overweight small probabilities 01:20 Disposition effect in real portfolios 01:50 Bias stack: sunk cost, endowment, confirmation, overconfidence 02:15 Myopic loss aversion: frequent checking lowers risk tolerance 02:40 Evidence: brokerage data, housing anchors, retirement savers 03:10 Limits & debate: when loss aversion weakens 03:30 Practical fixes: pre-commit rules, portfolio framing, fewer check-ins 04:20 Tools: checklist, automation, stop/swap/size, probabilistic thinking Subscribe for more evidence-first money psychology:    / @behavioralmoney   #moneypsychology #behavioralfinance #lossaversion