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[Elsbach] "People in moderately good or positive moods tend to be less thorough and less vigilant decision-makers, are more subject to cognitive biases, and rely more on heuristics than people in moderately negative moods".
[Montier] "Perhaps the best documented of all psychological errors is the tendency to be over-optimistic. The finding of consistent over-optimism results from a number of psychological biases, such as the illusion of control and self-attribution bias".
Optimism and Overconfidence in Asset Allocation Decisions, Benartzi, Kahneman, and Thaler
"Individual investors tend to be overly optimistic. They tend to focus more on potential positive returns than possible losses, and roughly a third of the people we surveyed believe that stocks are definitely guaranteed to outperform bonds over the long run. We wonder whether those overly optimistic investors understand the risk and return profile of their portfolios".
Irrational Optimism, Dimson, Marsh and Staunton, 2003
"We address the tendency of many investors to overestimate the rewards and underestimate the risks of investing in stocks over the long term - that is, investors' irrational optimism. In particular, we examine the widely held belief that stocks are a 'safe' investment for the long run".
The Level and Persistence of Growth Rates, Chan,, Karceski and Lakonishok, 2002
"While some firms have grown at high rates historically, they are relatively rare instances. Specifically, growth forecasts are overly optimistic and add little predictive power. Valuation ratios also have limited ability to predict future growth".
From Homo Economicus to Homo Sapiens, Thaler, 2000
"We all tend to be optimistic about the future. On the first day of my MBA class on decision-making at the University of Chicago, every single student expects to get an above-the-median grade, yet half are inevitably disappointed. This optimism will induce me to predict that economics will become more like I want it to be".
Fear and Greed In Financial Markets: A Clinical Study Of Day-Traders, Lo, repin and Steenbarger, 2005
"Recent research in the cognitive sciences and financial economics suggest an important link between rationality in decision making and emotion. We find a clear link between emotional reactivity and trading performance as measured by normalized profits-and-losses. Specifically, the survey data indicate that subjects whose emotional reaction to monetary gains and losses was more intense on both the positive and negative side exhibited significantly worse trading performance, implying a negative correlation between successful trading behavior and emotional reactivity. Also, contrary to common intuition regarding common personality traits of professional traders, the psychological traits derived from a standardized personality inventory survey instrument do not reveal any specific "trader personality type" in our sample. This raises the possibility that different personality types may be able to function equally well as traders after proper instruction and practice".
Social Mood and Financial Economics, Nofsinger, 2003
"We argue that the general level of optimism/pessimism in society affects the emotions of most financial decision-makers at the same time. This creates biased financial decisions that are correlated across society".

The evolution of optimism: A multi-agent based model of adaptive bias in human judgment, Evans, Heuvelink, and Nettle

Further evidence on optimism and underreaction in analysts' forecasts, Espahbodi, Dugar and Tehranian, 1991
"In this paper, we argue that the observed optimism in analysts' forecasts is related to the costs and benefits to analysts of issuing optimistic forecasts - when the costs of issuing an optimistic forecast are high relative to the benefits of doing so, optimism will be less apparent or absent".