n NISM Certifications
X NISM Series X
Medium

The investment decision influenced by selecting a high-profile manager in a company exemplifies which bias?

Practice question from NISM Series XB- Investment Adviser (Level 2) Mock Test 6 — bank. The correct answer is highlighted below with a full explanation.

Options

  1. A

    Loss Aversion Bias

  2. B

    Cognitive Bias

  3. Stereotyping Bias

    Correct answer

  4. D

    Bounded Rationality Bias

Why this is the answer

Investors often associate high-profile managers with better management and performance, based on stereotypes, which influences their investment decisions.

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