What if the brightest investment stories you hear are not the most instructive—but the most misleading? In Australia’s fast-evolving financial landscape, survivorship bias is everywhere, quietly skewing our perceptions of what works and what fails. As we head into 2025, with new market highs, tech unicorns, and property booms dominating headlines, understanding this cognitive trap is more crucial than ever for anyone aiming to make smarter money moves.
Survivorship bias is the tendency to focus on people or things that have ‘survived’ a process, overlooking those that didn’t. In the world of finance, this means we often celebrate the winners—successful startups, thriving managed funds, or skyrocketing shares—while ignoring the silent majority that failed along the way.
This bias distorts reality. For example, when you see lists of the ‘best-performing’ super funds or hear about friends who made a killing on crypto, you rarely see the hundreds of funds or investors who quietly underperformed or exited the market altogether. This selective attention can lead to:
In Australia, where property, shares, and small business play outsized roles in personal wealth, falling prey to survivorship bias can mean chasing trends or strategies that aren’t as reliable as they seem.
Let’s put the theory into practice. Here are three areas where survivorship bias is influencing financial choices across Australia right now:
Australian investors often compare superannuation and managed funds based on historical performance. But in 2025, many leading platforms are promoting their ‘top quartile’ results. What’s missing? The funds that quietly closed or merged after poor performance. According to APRA data, over 40 poorly performing MySuper products were delisted between 2021 and 2024, leaving only the survivors in public performance tables. This means today’s ‘best performers’ are cherry-picked from those who made it through, not representative of all options available to investors over time.
Australia’s startup scene is thriving, with record venture capital flows in 2024 and 2025. Success stories like Canva and SafetyCulture dominate headlines. But for every unicorn, hundreds of startups quietly close their doors. The latest ABS data shows that less than 60% of new businesses survive their first three years. Survivorship bias makes it seem like success is the rule, not the exception—fueling overconfidence among would-be founders and investors alike.
Property remains a national obsession. Stories of buyers who doubled their money in Sydney’s or Brisbane’s boom suburbs fill social media feeds. But how many tales do you hear of investors who bought at the wrong time, faced negative equity, or had to sell at a loss? CoreLogic figures from early 2025 show significant regional price corrections and mounting mortgage stress in some segments—realities often overlooked in the rush to celebrate the ‘survivors’.
Recognising survivorship bias is the first step to smarter financial choices. Here’s how to protect yourself from its seductive pull:
As new financial products and get-rich-quick narratives proliferate in 2025, keeping survivorship bias front of mind will help you cut through the noise and make decisions based on reality—not rosy survivor tales.