Chris Dillow 

The irrational minority

Chris Dillow

Chris Dillow
The irrational minority

One common objection to the idea that share prices are driven by irrational investors is that, over time, they should be driven out of the market as the smarter money profits at their expense. Very often, however, this claim is wrong as a new paper by Ulrike Malmendier at the University of California at Berkeley shows. She describes how markets sometimes actually select in favour of irrational buyers.

To continue reading, subscribe today

and enjoy unlimited access to the following:

  • Tips of the Week
  • Funds coverage
  • Weekly features on big investment themes
  • Trading ideas
  • Comprehensive companies coverage
  • Economic analysis
Subscribe to Investors Chronicle

Related topics

Subscribe today

Full access for just £3.37 a week:

• Tips and recommendations - to beat the market 
• Portfolio clinic & Mr Bearbull - build a well-planned portfolio 
• Expert tools - track and manage investments effortlessly
• Plus free delivery to your home or office

Subscribe Now