Capital Perspectives: Loss aversion revisited By: Chas Craig Guest Columnist February 23, 2021 Chas Craig “More money has probably been lost by investors holding a stock they really did not want until they could ‘at least come out even’ than from any other single reason. If to these actual losses are added the profits that might have been made through the proper reinvestment of these funds if such reinvestment had been made when the mistake was first realized, the cost of self-indulgence becomes truly tremendous.” – Philip A. Fisher, “Common Stock and Uncommon Profits” (1958) Longtime readers know that we regularly interweave behavioral finance observations into this capital markets-focused column because overcoming or succumbing to our psychological tendencies can have as much to do with investment success, or the lack thereof, as does competent fundamental analysis. We have also written explicitly on several psychological tendencies. First, excessive self-regard, over-optimism and availability misweighing were highlighted through the lens of Charlie Munger’s