Do individual investors learn from their trading experience
Gina Nicolosi and
No 532, Econometric Society 2004 North American Summer Meetings from Econometric Society
This paper investigates whether individual investors adjust their stock trading according to their stock selection abilities, which can be inferred from their trading history. Fixed-effect panel regressions provide strong evidence that the ability to forecast future stock returns significantly affects investorsâ€™ trading activity: investors purchase more actively if they are more likely to have stock selection ability. Furthermore, trading experience â€“ measured by the number of purchases, the number of different stocks purchased, and the variance of purchase dollar amounts â€“ significantly helps improve investorsâ€™ portfolio performance. In addition, we find that learning behavior varies across investors, which corroborates the heterogeneity of individual investors
Keywords: individual investors; learning; rationality; trading (search for similar items in EconPapers)
JEL-codes: D19 G14 (search for similar items in EconPapers)
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Journal Article: Do individual investors learn from their trading experience? (2009)
Working Paper: Do Individual Investors Learn from Their Trading Experience? (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:ecm:nasm04:532
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