All That Glitters

Author: Brad Barber & Terrance Odean

"We test and confirm the hypothesis that individual investors are net buyers of attention grabbing stocks, e.g., stocks in the news, stocks experiencing high abnormal trading volume, and stocks with extreme one day returns. Attention-driven buying results from the difficulty that investors have searching the thousands of stocks they can potentially buy. Individual investors don’t face the same search problem when selling because they tend to sell only stocks they already own..."

The Review of Financial Studies, 2006

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