A financial example illustrating representativeness is the winner loser effect documented by Werner De Bondt and Richard Thaler find that stocks that have been extreme past losers in the preceding three years do much better than extreme past winners over the subsequent three years. DeBondt (1992) shows that the long-term earnings forecasts made by security analysts tend to be biased in the direction of recent success. Specifically, analysts overact in that they are much more optimistic about recent winners than they are about recent losers.