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Options
-
Familiarity Bias
Correct answer
- B
Herd Mentality
- C
Overconfidence Bias
- D
Recency Bias
Why this is the answer
Familiarity Bias occurs when an investor prefers investments they are familiar with, which may lead to a concentrated portfolio. This bias can prevent diversification, as investors may avoid opportunities outside their comfort zone, preferring familiar assets instead.
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