Loss aversion/Prospect Theory: People are made more upset by losses than they are made happy by gains of the same amount. This is important for how people think about taking risks. Related is the disposition effect, which is closely related to behavioral finance. The disposition effect is the tendency for investors to hold onto losing stocks too long, and sell winning ones too soon. This concept relates to loss aversion, since the investors are putting off making their losses a reality. Also related is the behavioral economic concept of “status quo bias.” This explains that, against what economics would expect, people seem to like their current state more than any other state they see as different.