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Professor Peter Swan and OTA shed more Light on commonplace Misconceptions in Retail Trading and Investing

Online Trading Academy is a well-established leader in providing professional education for investors and traders looking to gain skills in the financial markets. The California-based organization has more than twenty years of assisting novice and experienced people in understanding and navigating financial markets. OTA has helped over 80,000 students make their first step in the trading and investing world, and as such, it is well within its place to research the segment of educated retail traders and investors. To carry out this task, OTA has launched the OTA Research center.

OTA Research Center aims to organize various research sources that people can choose for themselves. In the past, different investigations have contrasted in their findings. One research methodology conducted in 2013 showed that investors and traders eventually lose their money, while finding in 2016, claimed that research went in the opposite direction. The President of OTA, Mike Richardson, said that these puzzling findings made him reach out to Professor Peter Swan.

In their research, Peter Swan and his team used the “Holding –Period-Invariant” methodology in contrast to the biased “Calendar-Time”(C-T) methodology. Peter Swan adds that the Calendar-Time research methodology misrepresents the investors’ way of thinking. C-T claims that investors look at gaining returns over a specific period in a calendar. However, that is not the reality. Investors choose to exit, retain or buy more investment depending on the purchasing cost and sale, the expected returns on alternative or current investments. The Holding Period Invariant methodology reflects on this reality. It analyzes the round trip trades and is easy to use when the traders have the corresponding dataset.

Professor Swan finds that educated investors and traders turn away from common perceptions associated with rising prices and commonly cited research as they prefer to use contrarian methodologies. OTA Research Center will illuminate people on these misconceptions, biases, and myths as they seek to put together a diverse source of research.

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