There are differing opinions about whether overconfidence is good for humanity.
Some say that believing that you’re better than you really are is a self-fulfilling prophecy that’s good for ambition and swift decision-making.
Overconfidence can lead to boosts in social status, and overconfident populations have been shown to be more evolutionarily stable. Some argue that overconfidence leads to hubris, self-deception, and blind spots in decision making.
In behavioral finance, overconfidence for traders can lead to risky stock picks and overtrading. But what about personal finance?