dunning kruger effect

In the world of investing, success depends not just on knowledge or data, but on self-awareness. Many investors lose money not because they lack intelligence, but because they overestimate how much they truly know about the markets. This psychological pitfall — when confidence exceeds competence — lies at the core of the Dunning–Kruger Effect. Coined by psychologists David Dunning and Justin Kruger in 1999, the effect describes a cognitive bias where people with limited k...