While responding to a comment to another post from a couple of days ago, PG was reminded of a term, “Doctors’ Money.”
This is an example of a cognitive error often called, “transference of expertise.”
From Perceptual Edge:
People sometimes claim expertise in one field based on experience in another. This is a fallacious and deceitful claim. I have extensive experience in visual design, but I cannot claim expertise in architecture. Any building that I designed would most certainly crumble around me. I’m a skilled teacher, but this does not qualify me as a psychotherapist. That hasn’t stopped me from occasionally giving advice to friends, but without charge, which probably matches its worth. Although these fields of endeavor overlap in some ways, expertise in one does not convey expertise in another. No concert violinist would claim the transfer of that virtuosity to the saxophone, but IT professionals sometimes make claims that are every bit as audacious.
Link to the rest at Perceptual Edge
Basically, as stated at greater length above, the error is that someone who is an expert in one field of endeavor believes she/he is also an expert in another field.
As a baby lawyer working in a securities law firm a long time ago, PG learned that the term, “doctors’ money”, when applied to a stock or a company meant the equivalent of “dumb money”.
Because of a doctor’s extensive education and intellectual abilities in the medical field, many doctors felt their innate intelligence was such that they could listen to a description of a newly-public company or one that was planning a public offering of its stock in a year or so and discern which companies’ stock prices were certain to appreciate. If a startup company was backed by a lot of investments by physicians, this constituted a warning flag for more savvy investors.
There was also a herd phenomenon that sometimes occurred when one doctor found what he/she believed was an excellent investment and told professional associates and friends about it and those people bought the same stock.