When you're dealing with loss– state, in a parlor game or throughout a sporting occasion or with a declining stock– it can be tough to bear in mind your true tolerance for threat. You're most likely to seek danger more than you normally would.
In this episode of Choiceology with Katy Milkman (), we look at a propensity to seek danger in the face of losses when those losses aren't yet settled, however how chalking up those losses and proceeding can actually help you recalibrate your appetite for threat.
During the American Revolutionary War (), George Washington () and his generals typically adopted a technique of pulling back, or accepting losses on the battleground, in order to regroup and live to fight another day. Their method was typically successful versus the British, who burned through males and devices as they doubled down in their desire to win private fights at the cost of their goal of gaining back control of the American nests.
Mary Stockwell () is a historian, author, and former history teacher at Lourdes University () in Ohio. Her work is focused on the American Revolution. Her recent book is titled Unlikely General: "Mad" Anthony Wayne and the Fight for America ()
Next, Katy talks to Alex Imas () about his research study on risk-taking with time and how psychological choice bracketing impacts our choices in the face of loss. You can find out more in Alex's paper entitled "The Realization Impact: Risk-Taking after Recognized Versus Paper Losses." ()
Alex Imas () is a teacher of behavioral science and economics at the University of Chicago Cubicle School of Company. ().
Choiceology () is an original podcast from Charles Schwab ().
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Crucial Disclosures
The remarks, views, and viewpoints expressed in the discussion are those of the speakers and do not necessarily represent the views of Charles Schwab.
Data contained herein from 3rd party suppliers is acquired from what are considered dependable source. However, its accuracy, completeness or dependability can not be ensured and Charles Schwab & Co. expressly disclaims any liability, including incidental or substantial damages, emerging from errors or omissions in this publication..
All corporate names and market data shown above are for illustrative purposes just and are not a recommendation, offer to offer, or a solicitation of a deal to buy any security. Supporting paperwork for any claims or analytical information is readily available upon request..
Investing includes threat consisting of loss of principal.
The book How to Change: The Science of Receiving from Where You Are to Where You Want to Be is not associated with, sponsored by, or backed by Charles Schwab & Co., Inc. (CS&C o.). Charles Schwab & Co., Inc. (CS&C o.) has actually not evaluated the book and makes no representations about its material.
( 0624-4MRP).
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