What Is Confirmation Bias? Confirmation bias is a term from the field of cognitive psychology that describes how people naturally favor information that confirms their previously existing beliefs. Experts in the field of behavioral finance find that this fundamental principle applies to investors in notable ways. Because investors seek out information that confirms their existing
What Is Confirmation on a Chart? Confirmation on a chart describes a chart pattern that shows a sustainable stock trading opportunity, which by virtue of its persistence is confirmed (given credibility). This typically requires a minimum of three days that consist of several data points before confirming a new trend or pattern formation is underway.
What Is a Conflict of Interest? A conflict of interest occurs when an entity or individual becomes unreliable because of a clash between personal (or self-serving) interests and professional duties or responsibilities. Such a conflict occurs when a company or person has a vested interest—such as money, status, knowledge, relationships, or reputation—which puts into question
What Is Conflict Theory? Conflict theory, first developed by Karl Marx, is a theory that society is in a state of perpetual conflict because of competition for limited resources. Conflict theory holds that social order is maintained by domination and power, rather than by consensus and conformity. According to conflict theory, those with wealth and power
What Is Confluence? Confluence is the combination of multiple strategies and ideas into one complete strategy. Confluence occurs when two or more separate ideas or strategies are used together to form a comprehensive investment strategy that is in line with an investor’s risk profile and goals. This term can also be used when employing technical
What Is Confusion of Goods? Confusion of goods is a legal term used to describe a situation when the goods or property of two or more parties become commingled to the point where each party’s respective items can’t be readily determined. While the term can apply to money or property, it is most commonly used
What Is a Conglomerate? A conglomerate is a corporation of several different, sometimes unrelated, businesses. In a conglomerate, one company owns a controlling stake in several smaller companies, conducting business separately and independently. Conglomerates often diversify business risk by participating in many different markets, although some conglomerates, such as those in mining, elect to participate
What Is a Conglomerate Discount? A conglomerate discount refers to the tendency of markets to value a diversified group of businesses and assets at less than the sum of its parts. A conglomerate, by definition, owns a controlling stake in a number of smaller companies that operate independently of other business divisions. A conglomerate discount occurs when
What Is the Conglomerates Sector? The conglomerates sector refers to the group of stocks in the market that consist of large corporations holding a variety of diverse and sometimes unrelated subsidiary companies. Because many conglomerates hold unrelated businesses among one another and may not be direct competitors, the sector itself is quite difficult to analyze
What Is Conglomeration? Conglomeration describes the process by which a conglomerate is created, as when a parent company begins to acquire subsidiaries. Sometimes conglomeration can refer to a time period when many conglomerates are formed simultaneously. One of the chief advantages of conglomeration is the immunity that it provides the parent company from potential takeovers.
