Title: Rationalizing trading frequency and returns
Description: "Barber and Odean (2000) study the relationship between trading frequency and returns.  They find that households who trade more frequently have a lower net return than other households.  But all households have about the same gross return.  They argue that these results cannot emerge from a model with rational traders and instead attribute these findings to overconfidence.  Using a dynamic optimization approach, we find that neither a model with rational agents facing adjustment costs nor various models of overconfidence fit these facts"--National Bureau of Economic Research web site.