‘Anchoring’ is the psychological bias that causes us to apply a reference point in our decision-making process. Anchors often have little meaning and serve only to negatively influence a decision. Unfortunately, this bias frequently finds its way into decisions about investing. “The market is at an all-time high, so I’m going to sell.” “I don’t like ABC stock anymore, but I’ll wait until it gets back to $X to sell so I don’t take a loss.” Anchoring is a big hurdle to a disciplined investment strategy, as our minds are constantly trying to make us time the market. Data has shown time and again that trying to time the market is a futile effort. The Anchoring Effect: How the Mind is Biased by First Impressions on PsyBlog helps us understand what this bias does to us, and how to avoid it, which can only help in achieving our long-term financial goals.