Logical fallacies are errors in reasoning that undermine the quality of an argument.

THREAD: 20 common logical fallacies to learn, identify, and avoid:

Ad Hominem

Latin for "to the person" - an attack of the person rather than the argument.

Instead of addressing the argument and its points and merits, the offender attempts to refute the opposition on the basis of personal characteristics.

All-too-common in politics.
The Texas Sharpshooter

A Texan fires a gun at a barn wall and then paints a target around the closest cluster of bullet holes to create the appearance of accuracy.

Selecting and highlighting evidence that supports the conclusion while ignoring evidence that may refute it.
The Bandwagon Fallacy

An assumption of truth on the basis of the majority of people believing it to be true.

"Everyone believes X, so obviously X is true."

Typically offered without regard for the qualifications or ability of the people in question to validate the claim.
Straw Man

The offender ignores the actual argument and replaces it with a flimsy, distorted, easily-refuted argument (a “straw man”).

By replacing a strong argument with a weak one, the offender can create the illusion of an easy, swift victory.
Red Herring

The kippered herring was a smelly fish used to distract hunting dogs while training them to stay focused on a scent.

"Red herring" is now synonymous with distraction.

The offender distracts from the argument with a seemingly related (but actually unrelated) point.
Hasty Generalization

Jumping to conclusions.

Material, wide-ranging conclusions are made on the basis of an immaterial, narrow body of evidence.

Insufficient evidence has been gathered to justify the claimed conclusions.
Appeal to Authority

The over-reliance on the perspective of an "expert" to support the legitimacy of an argument.

The qualifications of the authority figure in the field of question must be considered.

Their support can be a feature - but not a pillar - of the argument.
No True Scotsman

The "appeal to purity" - the changing of the original argument to evade a counter-argument.

You claim a Scotsman never drinks scotch with soda. Charles says he is a Scotsman and drinks scotch with soda. You exclaim that Charles must not be a true Scotsman!
Sunk Cost Fallacy

Sunk costs are the economic costs already invested in an activity that cannot be recovered.

The fallacy is found in thinking that you should continue on the basis of all that you've put in, with no regard for future costs or likelihood of ultimate success.

The conclusion does not follow logically from the premises.

Presented evidence provides little or no actual support for the argument.

“Charles ate fish for dinner and is well-spoken, so he must be a banker.”
False Dilemma

Presenting only two choices or alternatives when there are many more that exist.

Ignores nuance and lends itself to extreme positions.

Typically reduces the potential for compromise, as the two options are painted as being extremely far apart.
Tu Quoque

Latin for “you too” - attempting to discredit an opponent’s argument by pointing out personal behavior as being inconsistent with their argument.

Targeting the hypocrisy of the opponent.

“Don’t question my integrity, look at all of the bad things you’ve done!”
Slippery Slope

An argument that begins with a benign starting point before using a series of successive steps to get to a more radical, extreme end point.

No single step appears ridiculous on the surface, but the connection of multiple steps into a series is highly-improbable.
Begging the Question

A form of circular reasoning in which the argument is presented in such a way that the conclusion is included in the premise.

“Ghosts are real because I once experienced something that had to be a ghost.”

Easy to identify. The logic collapses on itself.
Loaded Question

Asking a question with a presumption built into the question (pre-loaded!).

Typically intended to be inflammatory in nature.

The individual on the receiving end of the question is forced to respond despite the baseless, irrelevant nature of the presumption.
Post Hoc Ergo Propter Hoc

Argues that since Event B followed Event A, Event B must have been caused by Event A.

Just because B followed A, doesn’t necessarily mean that B was caused by A.

Correlation ≠ Causation.

Comes from the roots “equal” and “voice” - a single word or phrase can say two very different things.

Occurs when the offender uses a word or phrase in an intentionally misleading manner that sounds like it’s saying one thing but is actually saying something else.
Personal Incredulity

You are unable to understand or believe something, therefore you argue that it cannot be true.

Complex topics often require significant upfront work to understand, so an inability to understand cannot be used to argue the illegitimacy of a claim.
Burden of Proof

The inability to provide evidence that a claim is false is used as justification that the claim is true.

The burden of proof lies with the person making the claim to provide supporting evidence.

The lack of refuting evidence is not supporting evidence.
The Fallacy Fallacy

Incorrectly assumes that a claim must be false if a fallacy was used to argue the claim.

Just because someone has poorly argued a claim, does not mean the claim itself is definitively false.
So those are 20 common logical fallacies to learn, identify, and avoid.

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Here's Short Squeeze 101!


1/ First, the basics.

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The basics are covered in my thread below.


TL;DR - short selling is a way of betting against a stock - i.e. betting that its price will decline.

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It is the total number of shares that have been sold short (borrowed and sold), but have not yet been covered (bought and returned).

It is usually measured as a % of the # of shares outstanding.

3/ A "short squeeze" occurs when a heavily-shorted asset experiences a rapid upward price movement.

When this happens, short sellers may be forced to close their short positions (i.e. buy the stock and return it to the broker), further accelerating the upward price movement.

4/ Let's look at a simple example to show this in action.

We will use Tesla, one of the most heavily-shorted stocks in the world.

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• Positional Strangles
• Intraday Strangles
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How to sell Strangles in weekly expiry as explained by boss himself. @Mitesh_Engr

• When to sell
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• Exit

Beautiful explanation on positional option selling by @Mitesh_Engr
Sir on how to sell low premium strangles yourself without paying anyone. This is a free mini course in

1st Live example of managing a strangle by Mitesh Sir. @Mitesh_Engr

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• Added 20% cap more when in profit
• Booked profitable leg and rolled up
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2nd example by @Mitesh_Engr Sir on converting a directional trade into strangles. Option Sellers can use this for consistent profit.

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