DEFINITION of 'Analysis Paralysis'
Occurs when an individual becomes so lost in the process of examining and evaluating various points of data that he or she is unable to make a decision with it. Analysis paralysis can occur with many decisions, including investment decisions such as buying or selling securities. The inaction it causes can easily lead to losses in a portfolio or missed chances at larger profits.
BREAKING DOWN 'Analysis Paralysis'
Often, when examining facts related to a potential course of action, the pros outweigh the consor vice versaand an individual has a clear path ahead. When analysis paralysis sets in, it could be because the person never feels comfortable stopping his or her search for additional criteria to examine or that the pros and cons are equally weighted.