[ThinkBetter](https://thinkbetter.app/) → [Cognitive Biases](https://thinkbetter.app/cognitive-biases.md) → Hindsight Bias

# Hindsight Bias

The tendency to believe, after an event has occurred, that one would have predicted or expected the outcome.

![Hindsight Bias illustration](https://assets.thinkbetter.app/images/hindsight_bias.png)

Ever caught yourself saying, "I knew it all along" after something happens? That's hindsight bias. This bias makes us overestimate our ability to predict events once we know the outcome. It's like watching a mystery movie for the second time; you notice all the clues leading to the ending, but during the first watch, they weren't as obvious. Hindsight bias can lead us to falsely believe that past events were more predictable than they actually were, affecting our perception of decision-making and risk while also inflating our perception of our awareness of what is around us and our ability to predict future events as well as (we though) we predicted past.

## Example

**Investment Decisions**

After a stock's price changes, investors might think they knew it would happen. Acknowledging hindsight bias would lead to more cautious and informed investment strategies.

## In your professional life

**Maintain a Decision Journal**

Keep a decision journal documenting your thought process for important choices to accurately evaluate your decision-making skills later. As a financial analyst, record the rationale behind your investment recommendations, including the data you used, assumptions you made, and alternatives you considered. Periodically review this journal to identify patterns in your decision-making, both successful and unsuccessful. This practice not only improves your analytical skills over time but also provides valuable context for performance reviews and demonstrates your commitment to continuous improvement.

## Go deeper in ThinkBetter

The ThinkBetter app has the full Hindsight Bias deep-dive: more examples, a quiz to test yourself, audio narration, and a weekly path that builds these ideas into a habit.

- iOS: https://apps.apple.com/app/id6459831884
- Android: https://play.google.com/store/apps/details?id=io.ventureship.braintricks

### Related concepts

- [Confirmation Bias](https://thinkbetter.app/cognitive-biases/confirmation-bias.md)
- [All mental models](https://thinkbetter.app/mental-models.md)

Page: https://thinkbetter.app/cognitive-biases/hindsight-bias