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Market Intelligence › Basic Terminologies
The pain of loss is felt more than the joy of profit, due to which it becomes difficult to book loss.
Published by The Retail Trader · JUL 31, 2026 · Trading Psychology
Loss Aversion — The pain of loss is felt more than the joy of profit, due to which it becomes difficult to book loss.
This term comes under Trading Psychology, in the section “BIASES OF THE BRAIN”. These are those mental shortcuts which are useful in normal life, but are costly in the market:
Other terms in this group — understanding them together is more useful:
• Confirmation Bias
• Recency Bias
• Anchoring
• Overconfidence
• Hindsight Bias
• Survivorship Bias
• Gambler's Fallacy
• Sunk Cost Fallacy
• Lottery Bias
To read the entire group and all its examples in one place, see the journal "TRADING PSYCHOLOGY: Words from the Mind" - this term has been taken from there.
This entry is for educational purposes only and is not a recommendation to buy or sell. Exchanges change charges, margins, lot sizes and expiry rules from time to time, so verify any figures with your broker or exchange.