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Question #373

What differences in behavior do retail investors and institutions show during Bitcoin price swings?

Category: General
Retail investors have more capital and hold larger positions permanently unlike cautious institutions trading smaller volumes
Retail investors react emotionally to short term price swings while institutions take strategic long term positions
Institutions exit rapidly at market dips whereas retail consistently buy during any significant sudden price decline

Why is this the correct answer?

Retail investors often buy and sell based on recent price movements or hype, leading to emotional decisions during market swings. Institutions typically have research teams, risk management practices, and investment mandates that focus on long-term strategy. Understanding this behavioral difference helps beginners recognize why retail can amplify volatility while institutional flows may offer more stability over time.

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