Download or read book Investors Trading Activity written by Dimitrios Kourditis and published by . This book was released on 2012 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: Research studies (such as Kiyilar and Acar, 2009) have supported that investors act in irrational ways in some of their investment decisions, and financial models have failed to explain the real investors' behaviour. Investors' trading activity is influenced by personality traits and psychological biases (overconfidence, risk tolerance, self-monitoring, and social influence) and is also affected by mood. The aim of the thesis is to confirm these assumptions by developing and testing a model (using SEM analysis) which would incorporate and examine all of them simultaneously, as it actually happens in real life. The research population includes 345 Greek investors, including individuals' as w~rt' 'as professional' investors who work in various investment companies located all over the country. The data collection included two surveys. The first survey investigated psychological biases and personality traits to find if they correlate with stock trading performance, whereas the second survey examined the psychological predisposition to find whether mood affects stock trading performance. The results have verified that these psychological biases, personality traits and mood, influence investors' trading performance, frequency and volume, providing a complete research model. Another objective of this study was to understand the profile of Greek investors and test if there are differences among them as far as stock trading behaviour (performance, volume and frequency) is concerned. Cluster analysis (three-cluster solution) identified three investors' profiles, the low, moderate and high investor profile, and revealed that high profile investors (with the higher scores on the psychological biases and personality traits) trade high volumes of stocks, make transactions more frequently and earn higher stock profits compared to investors belonging to the other two profiles. A comparative analysis between professionals and individuals has shown that professional investors have higher performance than individuals as far as stock trading is concerned. The results have also shown that professional investors score high on the psychological biases and personality traits examined. The second stage of the study has required iterative data using questions that depict psychological predisposition in a dynamic way. The cluster analysis of 1 Non-professionals 2 Portfolio analysts and stockbrokers 1 the second data set has identified and compared different mood status highlighting differences among groups as far as their mood status and their stock trading performance is concerned. This study has provided evidence supporting the significance of some subjective factors, such as personality traits, psychological biases and emotions in investors' trading activity. The findings have shown that investors who have specific characteristics such as overconfidence, high self-monitoring, risk intolerance, positive mood and sociability are probably better on stock trading performance. ~'A This thesis could enable individual investors and inv;stment advisors, to construct a framework of the profile that contributes to high stock trading performance (a stock trading performance guide). Therefore, investors could possibly ensure the stock trading performance, to the extent that this depends on their profile. Moreover, the study contributes to the field providing a complete and verified research model concerning investors' trading behaviour. Additionally, a contribution of this study is the extensive literature review in the field of behavioural finance which provides a better understanding of behavioural factors and a framework for academics, researchers, individual and professional investors. Keywords: Behavioural Finance; Trading Behaviour; Trading Activity; Model Analysis. JEL Classification: C30, D14, Gll, 016.

Download or read book Investors Activity and Trading Behavior written by Petri Juhani Kyrolainen and published by . This book was released on 2003 with total page 46 pages. Available in PDF, EPUB and Kindle. Book excerpt: Utilizing a comprehensive data set on daily holdings of Finnish stocks, this paper examines momentum trading and herding of active vs. passive investors during the information technology (IT) stock bubble period of 1997-2000. Modern stock markets are characterized with tremendous amount of trading. Still the market participants are highly heterogeneous in terms of their trading activity. Employing a number of trading days as a measure of trading activity, we segregate investor population into ten activity categories. After aggregating these categories into larger investor groups, our aim is to compare trading styles of these contrasting activity groups. In the theoretical literature, it is often found that momentum trading and herding can potentially destabilize asset markets, therefore, our focus is on these specific trading styles. We find that particularly large active investors engage in momentum trading. Active investors as a group also tend to herd in their trading decisions. Furthermore, their herding tendency is increasing monotonically year on year. Buy pressures of active investors are positively associated with contemporaneous daily returns, implying either price pressures caused by their trading or intraday momentum trading. Passive investors' and small active investors' trading styles, on the other hand, exhibit contrarian fashion. Moreover, the passive investors' herding tendency is very strong over the sample period. Their buy pressures are negatively associated with contemporaneous returns. Finally, neither trading of active investors nor trading of passive investors seem to have predictive ability on returns. Our results are consistent of large active investors being contributors to the recent price bubble. Thus, active trading might not have solely positive effects on the efficiency of asset markets.

Download or read book Individual Investors and Volatility written by Thierry Foucault and published by . This book was released on 2013 with total page 75 pages. Available in PDF, EPUB and Kindle. Book excerpt: We show that retail trading activity has a positive effect on the volatility of stock returns. To identify this effect, we use a reform of the French stock market that triggers a drop in retail trading activity by raising the relative cost of speculative trading for retail investors. The daily return volatility of the stocks affected by the reform falls by twenty basis points (a quarter of the sample standard deviation of the return volatility) relative to other stocks. For affected stocks, we also find a significant decrease in the magnitude of return reversals and the price impact of trades. We argue that these findings are consistent with the view that some retail investors behave as noise traders.

Download or read book Financial Trading and Investing written by John L. Teall and published by Academic Press. This book was released on 2018-03-21 with total page 523 pages. Available in PDF, EPUB and Kindle. Book excerpt: Financial Trading and Investing, Second Edition, delivers the most current information on trading and market microstructure for undergraduate and master’s students. Without demanding a background in econometrics, it explores alternative markets and highlights recent regulatory developments, implementations, institutions and debates. New explanations of controversial trading tactics (and blunders), such as high-frequency trading, dark liquidity pools, fat fingers, insider trading, and flash orders emphasize links between the history of financial regulation and events in financial markets. New sections on valuation and hedging techniques, particularly with respect to fixed income and derivatives markets, accompany updated regulatory information. In addition, new case studies and additional exercises are included on a website that has been revised, expanded and updated. Combining theory and application, the book provides the only up-to-date, practical beginner's introduction to today's investment tools and markets. Concentrates on trading, trading institutions, markets and the institutions that facilitate and regulate trading activities Introduces foundational topics relating to trading and securities markets, including auctions, market microstructure, the roles of information and inventories, behavioral finance, market efficiency, risk, arbitrage, trading technology, trading regulation and ECNs Covers market and technology advances and innovations, such as execution algo trading, Designated Market Makers (DMMs), Supplemental Liquidity Providers (SLPs), and the Super Display Book system (SDBK)

Download or read book Investor Characteristics and Trading Activity in Different Market Conditions written by Daniel W. Richards and published by . This book was released on 2018 with total page 30 pages. Available in PDF, EPUB and Kindle. Book excerpt: Using a proprietary dataset comprising of the trading records of individual investors from a UK brokerage firm, we examine whether behavioural bias of individual investors is exacerbated by different market conditions. We find some evidence that investors who are prone to overconfidence trade more frequently following positive market conditions. Recent market volatility also induces more trading by these investors. We find investors who use the financial advisory services at the brokerage firm tend to trade more frequently. However, contrary to our expectations, advice-using investors' responses to market conditions are not different from those who do not use the services.

Download or read book Essays on Investor Trading Activity in a Limit Order Book Market written by Adeola Deji-Olowe and published by . This book was released on 2014 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Googlization and Retail Investors Trading Activity written by Christophe Desagre and published by . This book was released on 2019 with total page 40 pages. Available in PDF, EPUB and Kindle. Book excerpt: Building on Barber and Odean (2008), a growing body of papers document a positive relationship between Google Search Volume Index (SVI) and equity market returns. Such findings suggest that increased attention is combined with a buying pressure that subsequently results in positive returns. This relationship has been established at the market level. In this paper, we focus on a sample of retail investors and use SVI to test whether their aggregate (signed) trading activity is related to attention as well. We find that the relationship between SVI and our retail investors' trading activity is positive, even when controlling for some socio-demographics or subjective investor characteristics. However, this relationship is not stronger for purchases than for sales, thereby providing no support for the buying pressure hypothesis. We also document a bi-directional causality between attention and trading activity, although the contemporaneous effects are economically stronger and predominate. Our results are robust to different measures of attention and trading activity.

Download or read book Investment Intelligence from Insider Trading written by H. Nejat Seyhun and published by MIT Press. This book was released on 2000-02-28 with total page 452 pages. Available in PDF, EPUB and Kindle. Book excerpt: Learn how to profit from information about insider trading. The term insider trading refers to the stock transactions of the officers, directors, and large shareholders of a firm. Many investors believe that corporate insiders, informed about their firms' prospects, buy and sell their own firm's stock at favorable times, reaping significant profits. Given the extra costs and risks of an active trading strategy, the key question for stock market investors is whether the publicly available insider-trading information can help them to outperform a simple passive index fund. Basing his insights on an exhaustive data set that captures information on all reported insider trading in all publicly held firms over the past twenty-one years—over one million transactions!—H. Nejat Seyhun shows how investors can use insider information to their advantage. He documents the magnitude and duration of the stock price movements following insider trading, determinants of insiders' profits, and the risks associated with imitating insider trading. He looks at the likely performance of individual firms and of the overall stock market, and compares the value of what one can learn from insider trading with commonly used measures of value such as price-earnings ratio, book-to-market ratio, and dividend yield.

Download or read book Twenty Years of Economic Reconstruction in East Germany written by Christian Wey and published by . This book was released on 2009 with total page 113 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Cracking the Emerging Markets Enigma written by G. Andrew Karolyi and published by Oxford University Press, USA. This book was released on 2015 with total page 313 pages. Available in PDF, EPUB and Kindle. Book excerpt: Cracking the Emerging Markets Enigma outlines a rigorous, comprehensive, and practical framework for evaluating the opportunities and, more importantly, the risks of investing in emerging markets. Built on a foundation of sound research on foreign direct and portfolio capital flows, Andrew Karolyi's proposed system of evaluation incorporates multiple dimensions of the potential risks faced by prospective investors in an empirically coherent framework.

Download or read book Do Investors Trade More when Stocks Have Performed Well written by John Meredith Griffin and published by . This book was released on 2005 with total page 47 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Heterogeneity of Investor Price Expectations written by Rajendra K. Srivastava and published by . This book was released on 1981 with total page 21 pages. Available in PDF, EPUB and Kindle. Book excerpt:

Download or read book Technical Analysis of the Financial Markets written by John J. Murphy and published by Penguin. This book was released on 1999-01-01 with total page 579 pages. Available in PDF, EPUB and Kindle. Book excerpt: John J. Murphy has updated his landmark bestseller Technical Analysis of the Futures Markets, to include all of the financial markets. This outstanding reference has already taught thousands of traders the concepts of technical analysis and their application in the futures and stock markets. Covering the latest developments in computer technology, technical tools, and indicators, the second edition features new material on candlestick charting, intermarket relationships, stocks and stock rotation, plus state-of-the-art examples and figures. From how to read charts to understanding indicators and the crucial role technical analysis plays in investing, readers gain a thorough and accessible overview of the field of technical analysis, with a special emphasis on futures markets. Revised and expanded for the demands of today's financial world, this book is essential reading for anyone interested in tracking and analyzing market behavior.

Download or read book Investors Trading Behaviour and Stock Market Volatility During Crisis Periods written by Guglielmo Maria Caporale and published by . This book was released on 2019 with total page pages. Available in PDF, EPUB and Kindle. Book excerpt: This study examines the impact of investors' buy and sell trades on Korean stock market volatility across two crisis events, the Asian crisis of 1997 and the 2008 global financial crash. We investigate the trading behaviour of domestic vs. foreign and institutional vs. individual investors. Our results suggest that the buy and sell trades have an asymmetric effect on volatility that depends on the type of investor trading and on the phase of the business cycle. Buy orders appear to be more informative than sell orders since they mostly lower volatility in the pre-crisis periods, while sell and post-crisis buy trades affect volatility positively regardless of who trades (institutional or individual investors) and on what information (member, non-member). Most importantly, decomposing total buy and sell trades into trader-type categories reveals that some institutional investors are more informed traders that stabilize the market compared to individuals that always increase volatility. Foreign investors reduce volatility with their purchases and total trading activity in the whole Asian crisis sample, but only in the pre-crisis period before the recent global financial turmoil.

Download or read book Do Individual Investors Learn from Their Trading Experience written by Gina Nicolosi and published by . This book was released on 2009 with total page 28 pages. Available in PDF, EPUB and Kindle. Book excerpt: This paper investigates whether individual investors adjust their stock trading according to their stock selection abilities, which can be inferred from their trading history. Fixed-effect panel regressions provide strong evidence that the ability to forecast future stock returns significantly affects investors' trading activity: investors purchase more actively if they are more likely to have stock selection ability. Furthermore, trading experience - measured by the number of purchases, the number of different stocks purchased, and the variance of purchase dollar amounts - significantly helps improve investors' portfolio performance. In addition, we find that learning behavior varies across investors, which corroborates the heterogeneity of individual investors.

Download or read book Day Trading For Beginners written by Michael Branson and published by Michael Branson. This book was released on 2020-02-08 with total page 80 pages. Available in PDF, EPUB and Kindle. Book excerpt: Understanding how financial markets work is crucial to making sure that global and economic markets are stable. Market participants (traders) vary due to their capital endowment, financial motivation and the type of trading activity. Each activity is also subject to different regulations depending on how sensitive it is and the country that it is based. One of the trading strategies that many traders have come to love is day trading. This is a process whereby you buy and sell stocks on the same trading day. This is different from other types because the trading activity continues even after the marketing hours have closed. Traders that buy and sell using this method of trading are called day traders. The time allows you to run dozens of trades in a single day or run a single trade. You might decide to buy a stock the first day and then sell it the next day, that is if you realize that selling the same day might not prove profitable. The standard practice is for traders to close trades at the end of the day. Trades usually last a few minutes or seconds. These traders do this because they want to avoid any risks that arise out of price gaps between the closing price on the day of buying the stock and the opening price of the next day. Just like any other day, these traders make quick profits and also quick losses in such a short period of time. The good thing is that day trading gives you a chance to make decisions based on analysis of patterns. Day traders study the general market and the price and volume movement of the stocks. They then use fundamental and technical analysis to keep themselves abreast with the latest news items in order to make the right decisions. With the right decisions come better profits and satisfaction from all you do on the market.

Download or read book The Philadelphia Stock Exchange and the City It Made written by Domenic Vitiello and published by University of Pennsylvania Press. This book was released on 2010-04-14 with total page 272 pages. Available in PDF, EPUB and Kindle. Book excerpt: The Philadelphia Stock Exchange and the City It Made recounts the history of America's first stock exchange and the ways it shaped the growth and decline of the city around it. Founded in 1790, the Philadelphia Stock Exchange, its member firms, and the companies they financed had profound impacts on the city's place in the world economy. At its start, the exchange and its members helped spur the development of the early United States, its financial sector, and its westward expansion. During the nineteenth century, they invested in making Philadelphia the center of industrial America, raising capital for the railroads and coal mines that connected cities to one another and built a fossil fuel-based economy. After financing the Civil War, they underwrote the growth of the modern metropolis, its transportation infrastructure, utility systems, and real estate development. At the turn of the twentieth century, stagnation of the exchange contributed to Philadelphia's loss of power in the national and world economy. This original interpretation of the roots of deindustrialization holds important lessons for other cities that have declined. The exchange's revival following World War II is a remarkable story, but it also illustrates the limits of economic development in postindustrial cities. Unlike earlier eras, the exchange's fortunes diverged from those of the city around it. Ultimately, it became part of a larger, global institution when it merged with NASDAQ in 2008. Far more than a history of a single institution, The Philadelphia Stock Exchange and the City It Made traces the evolving relationship between the exchange and the city. For people concerned with cities and their development, this study offers a long-term history of the public-private partnerships and private sector-led urban development popular today. More generally, it traces the networks of firms and institutions revealed by the securities market and its participants. Herein lies a critical and understudied part of the history of metropolitan economic development.