Monday 1 January 2001

Recency Effect

This is the principle that the most recently presented items or experiences will most likely be remembered best. If you hear a long list of words, it is more likely that you will remember the words you heard last (at the end of the list) than words that occurred in the middle. This is the recency effect. You should also note that you will be likely to remember words at the beginning of the list more than words in the middle, and this is called the Primacy Effect.

In sports investing, the Recency Effect means that the public have a tendency to place too much relevance on recent results, and with it, too much money, which of course means there is value on the other side.  

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