scholarly journals Overconfidence Behavior and Disposition Effect of Investors in Taiwan Stock Market: Another Features to Visit

2021 ◽  
Vol 9 (5) ◽  
pp. 170-183
Author(s):  
Hsiang-Hsi Liu ◽  
Fei-Jen Kan
Keyword(s):  
Stock Market ◽  
Disposition Effect

Stock Market Investorss Use of Stop Losses and the Disposition Effect

2015 ◽  
Author(s):  
Daniel W. Richards ◽  
Janette Rutterford ◽  
Devendra G. Kodwani ◽  
Mark P. Fenton-O'Creevy
Keyword(s):  
Stock Market ◽  
Disposition Effect

scholarly journals Disposition Effect and Return Predictability in the Tunisian Stock Market

2017 ◽  
Vol 4 (1) ◽  
pp. 1
Author(s):  
Cheïma Hmida ◽  
Ramzi Boussaidi
Keyword(s):  
Stock Market ◽  
Behavioral Finance ◽  
Stock Prices ◽  
Stock Price ◽  
Return Predictability ◽  
Capital Gains ◽  
Disposition Effect ◽  
Individual Investors ◽  
Long Run ◽  
Return Reversal

The behavioral finance literature has documented that individual investors tend to sell winning stocks more quickly than losing stocks, a phenomenon known as the disposition effect, and that such a behavior has an impact on stock prices. We examined this effect in the Tunisian stock market using the unrealized capital gains/losses of Grinblatt & Han (2005) to measure the disposition effect. We find that the Tunisian investors exhibit a disposition effect in the long-run horizon but not in the short and the intermediate horizons. Moreover, the disposition effect predicts a stock price continuation (momentum) for the whole sample. However this impact varies from an industry to another. It predicts a momentum for “manufacturing” but a return reversal for “financial” and “services”.

scholarly journals FACTORS AFFECTING DISPOSITION EFFECT IN EQUITY INVESTMENT: A SOCIAL NETWORK ANALYSIS APPROACH

2020 ◽  
Vol 5 (3) ◽  
pp. 64-86
Author(s):  
K. Kajol ◽  
Prasita Biswas ◽  
Ranjit Singh ◽  
Sana Moid ◽  
Amit Kumar Das
Keyword(s):  
Social Network ◽  
Social Network Analysis ◽  
Network Analysis ◽  
Stock Market ◽  
Influencing Factors ◽  
Social Trust ◽  
Complete Analysis ◽  
Disposition Effect ◽  
Factors Affecting ◽  
The Relationship

The study aims at identifying the factors influencing the disposition effect acting on equity investors and further identifying the relationship between the influencing factors. The study aims at conducting a complete analysis of the influencing factors along with measuring their impact on disposition effect using Social Network Analysis (SNA).The factors affecting disposition effect on investors were identified through the literature review. Experts’ opinions were sought for determining the relationship among the factors and finally, the importance of those factors was analyzed using Social Network Analysis (SNA). It was found that social trust, investor emotion are the two most important factors affecting the other factors of disposition effect and consequently disposition effect finally. Besides, mental accounting; regret aversion, trading intensity, trading volume, and portfolio performance strongly influence the effect of disposition on investors because of their higher in-degree and out-degree. Therefore, the policymakers need to impart training to the investors to understand the mechanism of the stock market so that they can evaluate their standing in the stock market which, in the long run, will be reflected in their investment behavior. 

scholarly journals Return Anomalies “Disposition Effect and Momentum”: Evidence from the Egyptian Stock Market

2014 ◽  
Vol 6 (2) ◽  
Author(s):  
Ahmed M. Sakr ◽  
Mohamed A. Ragheb ◽  
Aiman A. Ragab ◽  
Rabab K. Abdou
Keyword(s):  
Stock Market ◽  
Disposition Effect

Is disposition related to momentum in Chinese market?

2015 ◽  
Vol 41 (6) ◽  
pp. 600-614 ◽  
Author(s):  
Liu Liu Kong ◽  
Min Bai ◽  
Peiming Wang
Keyword(s):  
Stock Market ◽  
Stock Markets ◽  
Disposition Effect ◽  
Chinese Stock Market ◽  
Momentum Effect ◽  
Chinese Market ◽  
Firm Level ◽  
Content Type ◽  
Level Data ◽  
The Relationship

Purpose – The purpose of this paper is to examine whether the framework of Prospect Theory and Mental Accounting proposed by Grinblatt and Han (2005) can be applied to analyzing the relationship between the disposition effect and momentum in the Chinese stock market. Design/methodology/approach – The paper applies the methodology proposed by Grinblatt and Han (2005). Findings – Using firm-level data, with a sample period from January 1998 to June 2013, the authors find evidence that the momentum effect in the Chinese stock market is not driven by the disposition effect, contradicting the findings of Grinblatt and Han (2005) concerning the US stock market. The discrepancies in the findings between the Chinese and US stock markets are robust and independent of sample periods. Research limitations/implications – The findings suggest that Grinblatt and Han’s model may not be applicable to the Chinese stock market. This is possibly because of the regulatory differences between the two stock markets and cross-national variation in investor behavior; in particular, the short-selling prohibition in the Chinese stock market and greater reference point adaptation to unrealized gains/losses among Chinese compared to Americans. Originality/value – This study provides evidence of the inapplicability of Grinblatt and Han’s model for the Chinese stock market, and shows the differences in the relationship between disposition effect and momentum between the Chinese and US stock markets.

A Study of the Disposition Effect for Individual Investors in the Taiwan Stock Market

2010 ◽  
Vol 46 (1) ◽  
pp. 108-119 ◽  
Author(s):  
Yeong-Jia Goo ◽  
Dar-Hsin Chen ◽  
Sze-Hsun Sylcien Chang ◽  
Chi-Feng Yeh
Keyword(s):  
Stock Market ◽  
Disposition Effect ◽  
Individual Investors

scholarly journals Dispositon Effect – Evidence from Vietnamese Individuial Investors

2013 ◽  
Vol 216 ◽  
pp. 54-67
Author(s):  
LÝ TRẦN THỊ HẢI ◽  
THƯƠNG HUỲNH NGỌC
Keyword(s):  
Stock Market ◽  
Disposition Effect ◽  
Transaction Data ◽  
Securities Company

This paper aims to investigate whether or not the disposition effect exists in the Vietnam?s stock market, and if so, which factors influence that effect. The authors employ the transaction data, which is from June 1, 2010 through June 30, 2012, of 100 customers of a securities company. Within this period, there are 27,591 transactions which are worth VND2,204 billion. The results reveal that the willingness to sell bullish stocks is 8.5% higher than the willingness to sell bearish ones. Male investors are less affected by the disposition effect than females. Accounts with huge transaction values rarely face this effect; meanwhile, the higher the number of transactions, the stronger the disposition effect.

Examining investors' sentiments, behavioral biases and investment decisions during COVID-19 in the emerging stock market: a case of Pakistan stock market

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Shagufta Parveen ◽  
Zoya Wajid Satti ◽  
Qazi Abdul Subhan ◽  
Nishat Riaz ◽  
Samreen Fahim Baber ◽  
...  
Keyword(s):  
Developing Countries ◽  
Stock Market ◽  
Behavioral Finance ◽  
Stock Markets ◽  
Investment Decisions ◽  
Equation Modeling ◽  
Disposition Effect ◽  
Content Type ◽  
Behavioral Biases ◽  
The Impact

PurposeThis study investigates the impact of the COVID-19 pandemic on investors' sentiments, behavioral biases and investment decisions in the Pakistan Stock Exchange (PSX).Design/methodology/approachThe authors have assessed investors' behaviors and sentiments and the stock market overreaction during COVID-19 using a questionnaire and collected data from 401 investors trading in the PSX.FindingsResults of structural equation modeling revealed that the COVID-19 pandemic affected investors' behaviors, investment decisions and trade volume. It created feelings of fear and uncertainty among market participants. Evidence suggests that behavioral heuristics and biases, including representative heuristic, anchoring heuristic, overconfidence bias and disposition effect, negatively influenced investors' decisions at the PSX.Research limitations/implicationsThis study will contribute to behavioral finance literature in the context of developing countries as it has revealed the impact of COVID-19 on the emerging stock market, and its results are generalizable to other emerging stock markets.Practical implicationsThe findings of this study will help academicians, researchers and policymakers of developing countries. Academicians can formulate new behavioral models that can depict the solutions of dealing with an uncertain situation like COVID-19. Policymakers like the Securities Exchange Commission and the PSX can formulate crisis management strategies based on behavioral finance concepts to cope with situations like COVID-19 in the future and help lessen investors' losses in the stock markets. The role of the Securities Exchange Commission is crucial as it regulates the financial markets. It can arrange workshops to educate investors to manage their decisions during crisis time and focus on the best use of irrational and rational decision-making at the same time using Lo (2004) adaptive market hypothesis.Originality/valueThe novelty of the paper is that the authors have introduced overconfidence and disposition effect as mediators that create a connection between representative and anchoring heuristics and investment decisions using primary data collected from investors (institutional and retail) to demonstrate the presence of psychological biases during COVID-19, and it has been done for the first time according to authors' knowledge. It is a contribution and addition to the behavioral finance literature in the context of developing countries' stock markets and their efficiency.

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