Youve lost money on a particular stock for the past three years. Thus, you believes the stock will have a high positive rate of return this year because earning a good return is long overdue. This assumption is best described as the:

1-fourth wave.

2-gambler's fallacy.

3-house money effect.

Massive gains in stocks like Facebook, Amazon, Apple and Google over the last few years led investors to buy up shares of most new tech IPOs such Twitter, Snap, GoPro and FitBit. The investors who bought these new IPOs are likely suffering from:

I. Availability heuristic/bias

II. Representativeness bias

III. Overconfidence

IV. Affect heuristic

1-I and II only

2-I, III and IV

3-I and III only