
A study of over 60,000 brokerage households by Barber and Odean found the 20% most active traders underperformed the market by 6.5% annually. The difference between a trader up 30% and one down 60% was not analysis quality but trading frequency. Overtrading, not being wrong about the market, is the real reason traders lose money.
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Meta: Valuation Gap Is Hard To Ignore