Survivorship Bias

In finance survivorship bias is a logical error of over analysing people or investments that have been artificially selected by a selection process and overlooking the broader space of entities that do not, typically because of their lack of visibility.

This is typically common in investing where select wins on specific investments are over analysed and broader losses are ignored.

For example a basket of tech stocks picked randomly during the height of the dotcom bubble would have performed very poorly on the time scale of the next decade and most simply ceased to exist. However a select few stocks (Google, Amazon, etc) outperformed the market. It would therefore be a fallacy to assume that the average dotcom tech stock outperformed the market because most did not survive long enough to sample.

See also endowment effect and bandwagon bias.


  1. Shaffer, Daniel S. 2010. Profiting in Economic Storms: A Historic Guide to Surviving Depression, Deflation, Hyperinflation, and Market Bubbles. John Wiley & Sons.
  2. Grinold, Richard C., and Ronald N. Kahn. Active portfolio management: Quantitative theory and applications. Probus, 1995.