Originally posted on thepensivenugget.comEveryone has heard of the law of large numbers, but what about the law of small numbers?In truth, there isn’t really such a law.The turn of phrase is simply used as a parody of the actual law (of large numbers) to illustrate that humans tend to draw firm conclusions from small samples — to their detriment.9. Believing In The Law Of Small NumbersA common example of this would be traders coming to the conclusion that their strategy is sound after a small number of profitable trades, which is related to some degree to the recency bias.This also applies to the o