Read? Older men are more likely to panic sell stocks: MIT study
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Researchers at the Massachusetts Institute of Technology are diving into the demographics of people that panic sell stocks during a market crash.
Investors who are male, over the age of 45, married or consider themselves as having “excellent investment experience” are more likely to “freak out” and dump their portfolio during a downturn, according to a paper published last month that analyzed more than 600,000 brokerage accounts.
The researchers say their work can be used to create predictive models, which would help identify individuals at risk of panic selling.
“Financial advisors have long advised their clients to stay calm and weather any passing financial storm in their portfolios,” wrote Daniel Elkind, Kathryn Kaminski, Andrew Lo and colleagues. “Despite this, a percentage of investors tend to freak out and sell off a large portion of their risky assets.”...