About

Terrance Odean is the Rudd Family Foundation Professor of Finance at the Haas School of Business at the University of California, Berkeley. He is an expert in behavioral finance, investor behavior, and the influence of individual investors on asset prices. Odean has held various academic and editorial roles, including editor and associate editor positions at prominent finance journals, and is an advisory editor of the Financial Planning Review. His research has been recognized with awards such as the James R. Vertin Award from the CFA Institute in 2016 for research of notable relevance and enduring value to investment professionals. Odean studied judgment and decision making as an undergraduate at UC Berkeley with Nobel Laureate Daniel Kahneman. His work focuses on investor welfare, behavioral finance, and the impact of investor actions on financial markets. He has been a faculty member at Haas since 2001, serving as the Rudd Family Foundation Chair since 2008, and has contributed extensively to the academic community through research, editorial work, and advisory roles.

Research topics

• Business
• Finance
• Monetary economics
• Economics
• Financial economics
• Psychology
• Geography
• Marketing

Selected publications

• <p><span>Mired in Losses: How the Disposition Effect Depresses Purchase Behavior</span></p>

  SSRN Electronic Journal · 2026-01-01

  preprintOpen access
  PublisherDOI

• The “Actual Retail Price” of Equity Trades

  The Journal of Finance · 2025-07-25 · 3 citations

  articleOpen accessSenior author

  ABSTRACT We compare execution quality of six brokerage accounts across five brokers by generating a sample of 85,000 simultaneous market orders. Commission levels and payment for order flow (PFOF) differ across our accounts. We find that execution prices vary significantly across brokers: the mean account‐level round‐trip cost ranges from 0.07% to 0.46%, excluding any commissions. The dispersion is due to off‐exchange wholesalers systematically giving different execution prices for the same trades to different brokers. Across brokers, variation in PFOF does not explain the large variation in price execution. We provide several suggestions for more informative disclosures on execution quality.

  PublisherOA PDFDOI

• Gain Without Pain: The Challenge of Inducing Risk Aversion in Economic Experiments

  SSRN Electronic Journal · 2024-01-01

  articleOpen access
  PublisherDOI

• A (Sub)penny for Your Thoughts: Tracking Retail Investor Activity in TAQ

  The Journal of Finance · 2024-05-03 · 68 citations

  articleOpen access

  ABSTRACT We placed 85,000 retail trades in six retail brokerage accounts from December 2021 to June 2022 to validate the Boehmer et al. algorithm, which uses subpenny trade prices to identify and sign retail trades. The algorithm identifies 35% of our trades as retail, incorrectly signs 28% of identified trades, and yields uninformative order imbalance measures for 30% of stocks. We modify the algorithm by signing trades using the quoted spread midpoints. The quote midpoint method does not affect identification rates but reduces the signing error rates to 5% and provides informative order imbalance measures for all stocks.

  PublisherOA PDFDOI

• Gain Without Pain: The Challenge of Inducing Risk Aversion in Economic Experiments

  SSRN Electronic Journal · 2024-01-01

  articleOpen access
  PublisherDOI

• Disposed to Be Overconfident

  SSRN Electronic Journal · 2023-01-01 · 5 citations

  articleOpen access
  PublisherDOI

• Stock repurchasing bias of mutual funds

  European Finance Review · 2023-10-06 · 3 citations

  articleOpen accessSenior author

  Abstract This article shows that mutual funds’ trading experiences bias their future repurchasing decisions. Mutual funds are less likely to repurchase a stock if they previously sold the stock for a loss rather than for a gain. After switching to managing a different fund, fund managers still avoid repurchasing stocks they sold for a loss at a past fund. We do not find that mutual fund managers are biased against repurchasing past loser stocks because of superior information. Though less likely to be repurchased, repurchased losers do not underperform repurchased winners—and the fund itself—in the subsequent quarter.

  PublisherOA PDFDOI

• Disposed to Be Overconfident

  SSRN Electronic Journal · 2023-01-01

  articleOpen access
  PublisherDOI

• Resolving a Paradox: Retail Trades Positively Predict Returns but Are Not Profitable

  Journal of Financial and Quantitative Analysis · 2023 · 49 citations

  Senior authorCorresponding
  • Business
  • Monetary economics
  • Economics

  Abstract Retail order imbalance positively predicts returns, but on average retail investor trades lose money. Why? Order imbalance tests equal-weighted stocks, but retail purchases concentrate on attention-grabbing stocks that subsequently underperform. Long–short strategies based on extreme quintiles of retail order imbalance earn dismal annualized returns of −14.8% among stocks with heavy retail trading but earn 6.6% among other stocks. Our results reconcile the literatures on the performance of retail investors, the predictive content of retail order imbalance, and attention-induced trading and returns. Smaller retail trades concentrate more on attention-grabbing stocks and perform worse.

  PublisherOA PDFDOI

• Attention‐Induced Trading and Returns: Evidence from Robinhood Users

  The Journal of Finance · 2022 · 482 citations

  • Business
  • Monetary economics
  • Financial economics

  ABSTRACT We study the influence of financial innovation by fintech brokerages on individual investors’ trading and stock prices. Using data from Robinhood, we find that Robinhood investors engage in more attention‐induced trading than other retail investors. For example, Robinhood outages disproportionately reduce trading in high‐attention stocks. While this evidence is consistent with Robinhood attracting relatively inexperienced investors, we show that it is also driven in part by the app's unique features. Consistent with models of attention‐induced trading, intense buying by Robinhood users forecasts negative returns. Average 20‐day abnormal returns are −4.7% for the top stocks purchased each day.

  PublisherDOI

Recent grants

• CAREER: Studies of Investor Behavior

  NSF · $252k · 2002–2007

Frequent coauthors

• Brad M. Barber

  89 shared

• Yu‐Jane Liu

  Peking University

  34 shared

• Yi‐Tsung Lee

  Ming Chi University of Technology

  32 shared

• Ning Zhu

  9 shared

• Hans K. Hvide

  8 shared

• Christopher G. Schwarz

  Mayo Clinic

  5 shared

• Simon Gervais

  5 shared

• Javed Ahmed

  5 shared

Education

• PhD, Haas School of Business

  University of California Berkeley

  1997

Awards & honors

• James R. Vertin Award from the CFA Institute (2016)
• Carleton College Alumni Distinguished Achievement Award (201…
• Barclays Global Investors Award for Best Conference Paper at…
• Barclays Global Investment / Michael Brennan Prize for the B…
• Graham and Dodd Award of Excellence (2000)