Unformatted text preview: lower quality ones which will make them lose more from missing out on the rise of their sold stock. Sometimes trading volume shows how well the market is doing, better performance can lead to higher volume and vice versa. People who are overconfident will buy too many high risk stocks and under diversify. Beta measures volatility compared to the market, greater than one exceeds market, one equals market, and less than one is less than market. The illusion of knowledge is where a person thinks more knowledge results in better decisions, it can also lead to increase confidence while the accuracy may not match. A study shows that people had higher returns when using a broker than going online. This is a result of higher turnover ratings, overconfidence, and active involvement....
View Full Document
- Fall '10
- Investing, active involvement, lowest turnover ratio, turnover rate results, higher turnover ratings, lower quality ones