Last nigh I watched a special TV commercial of INVESTOOLS which a platform for day traders. In 40 minutes I saw all kind of examples of behavioral finance traits. Those people trade all day without having any idea of what is going on. The people using that stuff are the prefect examples of the type of noise traders that were discussed in reading 13. Overconfidence, high turnover, herding behavior, they have it all. Go to their website investool.com and see some testimonies.
Refresh my memory - what is a ‘herding behaviour’ trait? High turnover can co-incide with overconfidence, correct, which leads to poor portfolio performance due to increased transaction cost… just thinking outloud…and highjacking the thread while i’m at it.
Herding is going with the crowd (mass)