MGMT310_lecture16

MGMT310_lecture16 - Todaywillbeafunday

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Today will be a “fun” day We’ll have a brief lecture on retail investor trading Then I’ll hand back exams Next class (Wednesday) we’ll start NPV analysis!! (ch. 9)
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dividual investors tend to… Individual investors tend to… Trade too often Hold on to losers hase the tion Chase the action Why do they/we do things??
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e tend to be overconfident We tend to be overconfident Well more than half the population think they are better than average at many things E.g., 94% of college professors think they are above average teachers (cnn.com, 12/8/2009) hat appens hen investors are overconfident? What happens when investors are overconfident? They trade more, earn less, under diversify This does not work out so well for them
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dividual investors’ sell uy choices Individual investors sell vs buy choices Individual investors tend to… Hold on to losers and sell winners Chase stocks with lots of media attention
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This note was uploaded on 01/31/2011 for the course MGMT 310 taught by Professor Matthewjamesbarcaskey during the Spring '08 term at Purdue.

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MGMT310_lecture16 - Todaywillbeafunday

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