Status Quo Bias
The preference for leaving things as they are, treating inaction as safer than action.
How it is identified
Test: the current arrangement is retained even when an alternative would be chosen if the positions were reversed
Unit
qualitative
In depth
Status quo bias arises from loss aversion combined with regret aversion: a bad outcome from a change feels worse than the same outcome from having done nothing. It explains why default options are so powerful in retirement systems, and why portfolios drift far from their intended allocation without anyone deciding they should. Inaction is a decision with consequences, but it does not feel like one, which is why the costs accumulate invisibly. Scheduled reviews and threshold-based rebalancing rules exist to force the decision into the open.
Worked example
A 60/40 allocation drifts to 78/22 over five years. Nobody decided to take substantially more risk, and nobody would have approved that allocation if asked to choose it deliberately.
Illustrative figures, chosen so the arithmetic is easy to follow. Not a live price and not a valuation of any company.
Educational reference only
This entry explains what “Status Quo Bias” means. It is not investment advice and not a recommendation to buy or sell any security. Any numbers above are illustrative, not live prices, and nothing here predicts price direction or rates a stock. Consider your own circumstances and consult a SEBI-registered investment adviser before acting.