RupeeCase Education . Disposition Effect . 1 of 3
Behavioural Finance
The stock you feel
best about selling
is probably the one
you should keep
Terrance Odean studied 10000 brokerage accounts
over seven years. One pattern showed up everywhere.
60%
of every sale was a winning position
Winners sold
60%
Losers sold
40%
Source . Odean 1998 . 10000 accounts . 1987 to 1993
The bias
Investors are 1.5x more likely to sell a winner than a loser