Loss aversion also commonly known as the ‘prospect theory’ is the psychological theory that we would rather avoid the enduring pain of a loss than the pleasure of a win.

In theory, it is favouring not wanting to lose something over actually winning something. There are so many common day-to-day examples of this theory, personal possessions being one of them. Not wanting to let something go because of the fear of ‘losing’ it rather than it having any sort of gain.