Wednesday, April 21, 2021

Focus on one incident without looking at the big picture

 Tesla shares dropped by 3.5% due to a crash of a Tesla car in Texas leading to the death of two people.

This was a panic reaction.

The investors who panicked did not consider the following:

a) There was a crash involving a Tesla car, out of over 1 million Tesla cars on the road.

b) If there was a fault in the Tesla cars, you would expect a few thousand crashes every day.

c) Each day, 3,700 people die on car crashes on the road from all types of vehicles.

This is an example of focusing on one incident, and failing to look at the big picture.

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