How Your Emotions Get in the Way of Smart Investing

Many people think they can beat the stock market by making constant moves. They can bring in a better return, they suppose, than people who simply park their money in index funds or other staid vehicles that promise only to match the market.

Some of this stems from a classic error of overconfidence. Many assume that playing the market is like playing tennis against a practice wall—when in fact there is an opponent on the other side of the net, in the form of CEOs who move the market by touting stocks and professional investors who take advantage of those swings. Some amateurs recognize that there are pros playing against them but still think they can win. A survey of amateur traders reveals that 62% expected to beat the market during the following 12 months.

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https://www.wsj.com/articles/how-your-emotions-get-in-the-way-of-smart-investing-1434046156