Many “Investors” Follow the Investing “Herd” to Their Peril

Jul 1999

Many investors simply follow their emotions and the investing herd.  The popularity of jumping onto short-term trends explains why markets gyrate far more than economic reality.  Remarkably, many investors follow the briefest of trends. . . . .  Investors feel empowered by their ability to make low-cost transactions; so they buy and sell frequently without much appreciation of whether they’re increasing or decreasing their odds of success. . . . , in recent times marketplace prices have been determined in good part by investors whose trading has little to do with logical analysis and lots to do with emotional behavior.