Your Most Recent Experience Is Not the Most Important One

The last thing that happened dominates how you think about everything. A recent market crash makes all investments feel dangerous. A recent success makes you feel invincible. This is recency bias: we give disproportionate weight to the latest data point while discounting older, often more representative, information. Your memory isn't a balanced archive — it's a news feed. To make better decisions, deliberately seek out older data and longer trends before reacting to what just happened.