Confirmation Bias Mitigation

Confirmation Bias Mitigation is the active, systematic effort to reduce the impact of confirmation bias on trading decisions. This involves techniques such as pre-mortem analysis, where a trader assumes their position has already failed and works backward to find the reasons why.

It also involves seeking out "devil's advocate" viewpoints and using quantitative models that are independent of the trader's subjective opinion. By building processes that force the consideration of opposing evidence, traders can improve their decision-making quality and reduce the likelihood of large, avoidable losses in their portfolios.