Four of the last five stocks your investment adviser recommended have outperformed the market.Thus,you believe that if you continue to follow her advice,that 80 percent of your investments will outperform the market over the long term.This belief is based on the:

Question

Quizplus · Accepted Answer

The belief that 80 percent of investments will outperform the market over the long term based on the performance of only four of the last five recommended stocks is an example of the law of small numbers, which involves making broad conclusions based on a small sample size. It is important to consider a larger sample size and different factors when making investment decisions.

Four of the Last Five Stocks Your Investment Adviser Recommended