Overconfidence bias

An emotional bias where an individual tends to overestimate his/her own intuitive ability, or reasoning.   Overconfidence may be intensified when combined with self-attribution bias, in which people take too much credit for successes, and assign blame to others for failures. While overconfidence is both cognitive and emotional, it is more emotional in nature because the bias primarily results from emotion.

Overconfidence bias has two forms: prediction overconfidence and certainty overconfidence. Prediction overconfidence leads individuals to underestimate uncertainty and the standard deviation of their predictions, while certainty overconfidence occurs when they overstate the probability they will be right. Overconfidence bias may cause market participants to underestimate risk, overestimate return, and fail to diversify sufficiently.