When agents first invest in financial markets, they are relatively inexperienced. The agents best positioned to educate the inexperienced stand to earn trading profits at the expense of inexperienced agents. Owing to this phenomenon, we show that the equilibrium amount of financial education...

We build a model where trading allows inexperienced agents to discern useful information sources. Upon losing money by trading on invalid information sources, investors learn from their experience and switch to alternative sources. Such activity leads to initial expected losses but later...