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Financial Decoder

Do Investing Pros Make Smart Buy and Sell Decisions?

Mar 18, 2024
Behavioral economics expert Alex Imas, from the University of Chicago, discusses a study revealing how professional investors struggle with cognitive biases in buying and selling decisions. Despite success in buying, they perform worse than chance in selling. Emphasizes the importance of balancing attention in both decisions and avoiding heuristics for optimal returns.
19:31

Episode guests

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Quick takeaways

  • Choosing what to sell is as crucial as selecting what to buy for successful investing.
  • Professional investors excel in making buying decisions but struggle with selling due to psychological biases.

Deep dives

Study Focuses on Buying and Selling Behavior in Investing

Investors in the podcast episode discuss the importance of making decisions on what assets to buy, hold, or sell. The study highlighted in the podcast examines the psychology behind buying and selling stocks, especially focusing on professional portfolio managers. It was revealed that successful investors understand that choosing what to sell is as crucial as selecting what to buy.

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