Regret Theory
Regret theory is a behavioral theory, saying that investors could take either smaller or larger portions of risk when investing, depending on the past experiences.
If investor regrets on some investment he made because he lost money at the end, he will be more cautious and risk-averse next time. Contrarily, if investor missed some good returns on an investment he didn't participate because he was too cautious, next time he will be less risk-averse and will unadvisedly jump into similar investments.
Regret theory play large role decision processes, among other motivation and behavioral theories.
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