Barber and Odean (2000) ranked portfolios by turnover and report that the difference in return between the highest and lowest turnover portfolios is 7% per year. They attribute this to
A) overconfidence.
B) framing.
C) regret avoidance.
D) sample neglect.

Question

Quizplus · Accepted Answer

Barber and Odean (2000) attribute the difference in return between the highest and lowest turnover portfolios to overconfidence, suggesting that investors who trade more frequently, often due to overconfidence in their trading abilities, tend to achieve lower returns.

Barber and Odean (2000) Ranked Portfolios by Turnover and Report