provide a response to this discussion post, include citations Home Bias describes the stubborn tendency of investors to load up on domestic equities, even when Modern Portfolio Theory dictates that a truly global mix would lower overall risk. Far from a harmless preference, this tilt betrays a series of cognitive shortcuts that punish portfolios with unnecessary homemarket concentration. The availability heuristic inflates the perceived importance of domestic firms simply because local news and conversations are more accessible (Tversky & Kahneman, 1974). Familiarity bias deepens the error by tricking investors into believing that name recognition equates to safety, prompting them to double down on "household" stocks regardless of actual fundamentals (Huberman, 2001). Overconfidence then cements the misjudgment, as investors convince themselves they possess superior insight into homemarket dynamics and thus can safely underweight foreign assets (French & Poterba, 1991). This selfreinforcing loop not only leaves portfolios exposed to countryspecific shocks but also undercuts longterm, riskadjusted returns. Part 2: InformationBased Explanations and Their Limits Proponents of informationbased rationales argue that Home Bias may reflect real advantages rather than pure parochialism. Domestic firms often furnish more timely, detailed disclosures in investors' native language, shrinking information asymmetries and lowering transaction costs (Coval & Moskowitz, 1999). Local