überbewerten

Überbewerten is a German verb meaning to attribute too much value to something; to overestimate the importance, quality, or worth of a person, object, idea, or phenomenon. The prefix über- signals excess, while bewerten means to assess or evaluate. In ordinary usage, it describes a subjective tendency to place excessive significance on certain aspects, leading to distorted judgments or decisions. The corresponding noun is Überbewertung, or in English, overvaluation.

In economics and finance, Überbewertung refers to a market condition in which asset prices exceed their intrinsic value, often driven by speculation, hype, or momentum trading. Indicators include price-to-earnings ratios that appear high relative to fundamentals, or sentiment-driven price action that disconnects from cash flows or earnings.

In psychology and sociology, Überbewerten captures cognitive bias where a person overestimates the importance or ability of a trait, person, or plan. Mechanisms include the halo effect, availability heuristic, and confirmation bias, which can reinforce overvaluation of evidence that supports preconceptions.

Examples include overrating the potential of a startup based on early publicity, overvaluing a luxury good because of brand prestige, or overemphasizing the significance of a single study.

Related terms include Unterbewerten (undervaluation) and Überbewertung of risks, assets, or futures. The term is used descriptively in analysis, critique, and media reporting to note when judgments may rest on inflated estimates rather than objective assessment.