“The tendency to temper forecast so that they do not appear extreme.” Think I’ve read this somewhere, but can’t find it now. It appeared in sample exam 1, though it’s not the right answer.
prudence trap
Yeah - you may have had trouble finding it because its actually under the capital market expectations SS, not behavioral finance.
close cousin: status quo trap --> tendency for forecast to perpetuate recent observations, i.e., no change in recent past, also from same reading.
Prudence Trap = “The tendency to temper forecast so that they do not appear extreme.” 6 Psychological Traps… which one am I missing? Anchoring Status Quo C Overconfidence Representative Prudence
Confirming evidence
elcfa - I disagree. Tempering means Prudence. No Change means Status Quo. Not the same thing.
In general, any of the behavior not consistent with a rational behavior could be called a trap, i.e., any term in the Fin. Beh. stuff. When it comes to specific term including the word ‘trap’ explicitly, I have also Recallability trap: Finding patterns: strongest impression/stereotypes. Most avail, salient, resonant, narrow experience range.
Thanks Aimee! I had a brain block just then and you just unblocked it for me. 
bidder Wrote: ------------------------------------------------------- > elcfa - I disagree. Tempering means Prudence. No > Change means Status Quo. Not the same thing. Did not say they are same thing. Did say they are close cousins, so that everyone is aware.