Here's another post in our series on the learnings from the book The Millionaire Next Door. A quote from pages 100-101:
We have encountered more non-millionaire active traders than millionaires who actively trade. How can this be possible? Because it is very expensive to buy and sell, buy and sell, buy and sell one's equity holdings each day or week or month.
Often, active investors spend more time trading than studying and planning their investments. Conversely, millionaires spend more time studying far fewer offerings. Thus, they can focus their time and energy -- the resources needed to master their understanding of a much smaller variety of offerings in the market.
As I've said previously, both time and cost are reasons I don't actively trade (at least from a selling standpoint -- I regularly invest in mutual funds through automatic investment programs I've set up).
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