Professor Peter Swan and the Online Trading Academy Challenge the Myth

Often people have believed that investors and retail traders generally have at most times. They have based their argument on the research study” The Behavior of Individual Investors” conducted and complied by Brad Barber and his colleague Terrence Odean.

However, Professor Peter Swan and a few of his colleagues using the Holding- Perion Invariant seeks to challenge this argument. The professor, who has over 20 years of impacting and teaching students all things to do with trading and investing, is adamant that the argument has some loopholes.

Breaking It Down

He adds that while avoiding the biases of the Calendar-Time methodology, it is possible to come up with a different conclusion.

Giving an illustration, he said that while using the Calendar-Time methodology, households appear to be performing way worse as compared to institutions, but while using the Holding-Period-Invariant methodology, households appear to be doing and performing much better than institutions.

Professor Swan also stated that the Calendar-Time research methodology has adversely affected how most investors think and act as many of them invest intending to get a return after a specific period, whether it is a day or a week.

Professor Swan said that their Holding-Period Invariant methodology is much better as it unequivocally depicts what happens on the ground mainly by looking at the round-trip trades.

Professor Swan also maintained that their methodology holds merit. Since, unlike the other methodologies, it factors in that informed households don’t fall prey to the hype brought by rising prices often orchestrated by intuitional momentum traders seeking to utilize other people’s money to work in their contrarian.

Online Trading Academy

To dispel myths and theories that don’t clearly depict the issues on the ground regarding investments, the Online Trading Academy has set up an OTA Research Center. A place where retail traders and investors can have access to a wide array of research material and gain exposure to different perspectives such as Professor Swan’s that may aid in changing their mindset.

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