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Placeholder Lesson:
** This lesson is generated with AI assistance and approved by Danny Nelson. This lesson will communicate the essence of the topic for now until Danny can create a full lesson. **
Familiarity bias is the preference for things, strategies, investments, or choices that feel familiar.
People equate familiarity with safety, even when evidence suggests otherwise.
This can lead to avoiding better but less familiar opportunities.
In finance, it results in poorly diversified portfolios.
The bias prioritizes comfort over objective evaluation.