A Barclays Wealth study spotlights this "trading paradox." Some wealthy investors feel compelled to keep buying and selling even though they know their wealth suffers as a consequence.
“This trading paradox exists, to one degree or another, everywhere in the world,” Greg B. Davies, the head of behavioral and quantitative finance at Barclays Wealth, said.…. “Not everyone is prone to frequent trading, but among those who feel that they must trade frequently to do well, there is a substantial proportion who are troubled by their behavior.”A U.S. News column notes that two groups of wealthy investors tend to behave more rationally:
Could that be why the clients of prudent trust institutions so often turn out to be retirees and/or female?
… women are better long-term investors than men. Men tend to take more risks and are more likely to favor frequent trading and efforts to time the market. "Women tend to have lower composure and a greater desire for financial self-control, which is associated with a desire to use self-control strategies," the report said. "Women are also more likely to believe that these strategies are effective." As a consequence, women tended to trade less and earn higher returns over time.
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