An interesting piece of investing advice says you cannot make your money and count your money at the same time. This idea holds true when considering how investors make profits from their Investments. The prevailing method of calculating profits has always been based on time, calendar time to be exact. Calendar time is the Main idea used in calculating interest, determining profits and projecting future earnings. While this methodology looks sound at first glance it does not reflect how investors actually behave in the markets. Professor Peter Swan and his colleagues at the Online Trading Academy, or OTA, are set to introduce a new idea That better explains how retail investors make their money.
As part of Experimental research done by Peter Swan, Wei Lu and Joakim Westerholm, it was discovered that when profits are calculated by calendar time for retail investors it appears that they lose money. What they discovered is that investors go by a different sort of trading mythology, which they named Holding Period Invariant Trading, or HPI. Simply put, the HPI methodology shows investors do not invest based on time intervals. Instead, everyday investors use a combination of pricing the performance of their current Investments and retaining information on their past trades. When measuring profit from this methodology, Professor Swan learned that retail investors actually beat institutions in trading, whereas in the calendar time methodology institutional investors have the edge.
Online Trading Academy strives to do more research like this for their clients, who number in the tens of thousands. They aim to reveal and refute common misconceptions, and arm investors with knowledge that will help them gain more in their trades. They are not seeking definitive Dogma about investing; they want to put information out there that will allow the individual investor to make up their own mind.
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