Evidence from nancial markets suggests that asset prices can be consistently far from their funda-mental value. Prices seem to underreact to news in the short-run and overreact in the long-run. Inthis paper, we use Dual Process Theory to describe traders behavior. In particular, a part of tradersholds wrong beliefs anytime the market environment does not change suciently. The proportion oftraders with wrong beliefs will depend on how similar past market environments are with the presentone. We show that such model not only can be seen as a way of endogenizing noise trading, butalso provides a justication for noise traders' beliefs and it shows that underreaction and overreactionnaturally arise in such framework. Finally, we discuss how the model might help understanding theemergence of the equity-premium puzzle and its variation through time.