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Outcome bias

Grading a decision by how it turned out rather than by what you knew and how you acted when you made it.

A reckless trade that wins gets remembered as a good read. A disciplined trade that loses gets remembered as a mistake. Over a few hundred repetitions that scoring system trains exactly the wrong habits.

Since any single trade is mostly noise, results are a terrible short-run teacher. Process quality is knowable immediately; outcome quality only emerges across a large sample-size.

Score the decision separately from the result. Four boxes: good process with a win, good process with a loss, bad process with a win, bad process with a loss. The dangerous box is the third one, because it pays you for doing the wrong thing.

Related: resulting, process-over-outcome, self-attribution-bias, hindsight-bias

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