Even HNIs and mass affluent individuals need to be extra careful about the risks We discussed earlier, the debacle in Yes Bank additional tier 1 (AT1) perpetual bonds, how they were mis-sold to investors who are not savvy, and the matter being in the court of law now.
In light of this unfortunate episode, let us now take another look. The reason is, in behavioural finance, there is a concept of recency bias, which means people give higher weightage to events in the recent past.
Till Yes Bank AT1 default, the recency bias was positive as there was no default in this category of bonds. Now the bias is negative, fresh from the memories of Yes Bank.