Availability is a cognitive heuristic in which a decision maker relies upon knowledge that is readily available rather than examine other alternatives or procedures.
"There are situations in which people assess the frequency of a class or the probability of an event by the ease with which instances or occurrences can be brought to mind. For example, one may assess the risk of heart attack among middle-aged people by recalling such occurrences among one's acquaintances. Similarly, one may evaluate the probability that a given business venture will fail by imagining various difficulties it could encounter. This judgmental heuristic is called availability. Availability ia a useful clue for assessing frequency or probability, because instances of large classes are usually reached better and faster than instances of less frequent classes. However, availability is affected by factors other than frequency and probability. Consequently, the reliance on availability leads predictable biases,[...]"
Tversky and Kahneman (1974)
It is easier for us to recall information which has recently arrived. Stocks with very high levels of press coverage underperformed in the subsequent two years
"We find that overestimation of the subjective probabilities can cause overreaction and underreaction of expectations and, subsequently, asset prices."
Chiodo et al. (2002)
Overreact to news
Saliency can cause investors to overreact to new information.
=availability
Availability - evaluation about frequency, probability, and causality relationships that relies on how easily information is recalled from memory
Availability heuristic (how easily things come to mind): Tversky and Kahneman (1973).
Taleb (2004)
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