How Comparing Yourself to Others Can Derail Your Investment Strategy
Scrolling through stock market leaderboards or hearing a colleague brag about their holdings may feel harmless. Yet, a growing body of behavioral research shows that the simple act of comparing yourself to other investors can warp your decision-making. Investors shown a scoreboard of top stock performers tend to pile into riskier positions, increase their trading frequency, and still walk away less satisfied with their own results.
The pattern is not confined to simulated markets, nor does it affect day traders alone. Peer comparison shapes everything from core portfolio holdings to 401(k) contribution rates. The common thread: When we focus on relative performance, our brains shift from long-term wealth building to short-term…
