overconfidence effect
[/ˌoʊvərˈkɑːnfɪdəns ɪˈfɛkt/]
nounpl: overconfidence effects
efeito de excesso de confiança
1. A cognitive bias in which a person's subjective confidence in their judgments is reliably greater than their objective accuracy, particularly in tasks requiring knowledge or skill
The overconfidence effect caused the investor to overestimate his ability to predict market trends, leading to significant losses.
O efeito de excesso de confiança levou o investidor a superestimar sua capacidade de prever tendências de mercado, resultando em perdas significativas.
2. A psychological phenomenon where individuals believe they are better than average at performing tasks, even without evidence supporting this belief
Studies show the overconfidence effect is particularly strong in domains where people have limited expertise.
Estudos mostram que o efeito de excesso de confiança é particularmente forte em áreas onde as pessoas têm experiência limitada.
3. The tendency to overestimate the accuracy of one's knowledge, predictions, or abilities in various contexts
The overconfidence effect can lead traders to take excessive risks in financial markets.
O efeito de excesso de confiança pode levar traders a assumirem riscos excessivos nos mercados financeiros.
The overconfidence effect is extensively studied in both American and Brazilian academic institutions, particularly in business schools and psychology departments. In the USA, it's frequently cited in finance and investment advisory contexts. In Brazil, the concept has gained prominence in corporate training and decision-making contexts, especially following the 2008 financial crisis which highlighted the dangers of overconfident investment decisions. The term is increasingly recognized in Portuguese-speaking business communities as a critical factor in understanding market behavior and individual decision-making.
NYC Slang
thinking you're the man when you're really not
Related Idioms & Phrases
biting off more than you can chew
having your head in the clouds
thinking you're better than you are
more confidence than competence
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