Källa: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=1872211
Abstract
We provide an overview of research on the stock trading behavior of individual investors. This research documents that individual investors
underperform standard benchmarks (e.g., a low cost index fund),
sell winning investments while holding losing investments (the “disposition effect”),
are heavily influenced by limited attention and past return performance in their purchase decisions,
engage in naïve reinforcement learning by repeating past behaviors that coincided with pleasure while avoiding past behaviors that generated pain, and
tend to hold undiversified stock portfolios.
These behaviors deleteriously affect the financial well being of individual investors.
Från deras sammanfattning
The investors who inhabit the real world and those who populate academic models are distant cousins. In theory, investors hold well diversified portfolios and trade infrequently so as to minimize taxes and other investment costs. In practice, investors behave differently. They trade frequently and have perverse stock selection ability, incurring unnecessary investment costs and return losses.
They tend to sell their winners and hold their losers, generating unnecessary tax liabilities. Many hold poorly diversified portfolios, resulting in unnecessarily high levels of diversifiable risk, and many are unduly influenced by media and past experience. Individual investors who ignore the prescriptive advice to buy and hold low-fee, well-diversified portfolios, generally do so to their detriment.