The trace of a diagonalizable matrix equals the sum of its eigenvalues because the trace is defined as the sum of the diagonal elements, which correspond to the eigenvalues in a diagonal matrix. The discussion highlights the importance of understanding the algebraic properties of the trace, particularly its similarity invariance, meaning it remains constant under similarity transformations. This property allows for the conclusion that the trace of any diagonalizable matrix is equal to the sum of its eigenvalues. The participants express a need for a formal proof and clarification on the trace of diagonal matrices. Overall, the relationship between the trace and eigenvalues is a fundamental concept in linear algebra.