Narrative Fallacy
Also called: storytelling bias, narrative bias
The narrative fallacy is our compulsion to explain random outcomes with coherent stories. Financial media runs on it: markets fell today because of something, when most daily moves are noise. The cost is that a satisfying story feels like understanding, which raises confidence without raising accuracy — and stories built from survivors are the ones that circulate most.
Want more than a definition? Learn it in Mind Over Markets →