Why Does Momentum Persist?

2020 ◽  
Vol 8 (11) ◽  
pp. 119-125
Author(s):  
Greg Samsa
Keyword(s):  
Behavioral Finance ◽  
Stock Prices ◽  
Cognitive Biases ◽  
Financial Incentive ◽  
Feedback Loops ◽  
Structural Factors ◽  
Short Term ◽  
Factors Affecting ◽  
Money Managers ◽  
The Impact

The phenomenon of short-term momentum in intriguing because it directly contradicts the notion that in an efficient market stock prices should lack memory.  Three classes of possible explanation for momentum are (1) it is consistent with tenets of efficient markets after appropriate risk adjustment; (2) it is consistent with tenets of behavioral finance because of investors' cognitive biases; and (3) it is consistent with structurally-based positive feedback loops.  The presence of extreme bubbles provides evidence against the first explanation.  The fact that prices are effectively set by institutional investors who are aware of the cognitive biases in question and have a financial incentive to avoid them provides evidence against the second.  Structurally-based explanations include the short-term incentives of institutional money managers and the impact of indexing.   We believe that considering structural factors affecting the behavior of stock prices provides an additional perspective, to be used in combination with behavioral finance and market efficiency. 

scholarly journals Analyzing Factors Affecting the Sustainability of Land Management Practices in Mecha Woreda, Northwestern Ethiopia

2021 ◽  
Vol 13 (13) ◽  
pp. 7007
Author(s):  
Habtamu Nebere ◽  
Degefa Tolossa ◽  
Amare Bantider
Keyword(s):  
Decision Making ◽  
Land Management ◽  
Land Degradation ◽  
Quantitative Data ◽  
Management Practices ◽  
Short Term ◽  
Factors Affecting ◽  
Decision Making Processes ◽  
Household Heads ◽  
The Impact

In Ethiopia, the practice of land management started three decades ago in order to address the problem of land degradation and to further boost agricultural production. However, the impact of land management practices in curbing land degradation problems and improving the productivity of the agricultural sector is insignificant. Various empirical works have previously identified the determinants of the adoption rate of land management practices. However, the sustainability of land management practices after adoption, and the various factors that control the sustainability of implemented land management practices, are not well addressed. This study analyzed the factors affecting the sustainability of land management practices after implementation in Mecha Woreda, northwestern Ethiopia. The study used 378 sample respondents, selected by a systematic random sampling technique. Binary logistic regression was used to analyze the quantitative data, while the qualitative data were qualitatively and concurrently analyzed with the quantitative data. The sustained supply of fodder from the implemented land management practices, as well as improved cattle breed, increases the sustainability of the implemented land management practices. While lack of agreement in the community, lack of enforcing community bylaws, open cattle grazing, lack of benefits of implemented land management practices, acting as barrier for farming practices, poor participation of household heads during planning and decision-making processes, as well as the lack of short-term benefits, reduce the sustainability of the implemented land management practices. Thus, it is better to allow for the full participation of household heads in planning and decision-making processes to bring practical and visible results in land management practices. In addition, recognizing short-term benefits to compensate the land lost in constructing land management structures must be the strategy in land management practices. Finally, reducing the number of cattle and practicing stall feeding is helpful both for the sustainability of land management practices and the productivity of cattle. In line with this, fast-growing fodder grass species have to be introduced for household heads to grow on land management structures and communal grazing fields for stall feeding.

Does salience matter in investment decision?

Kybernetes ◽  
2019 ◽  
Vol 48 (8) ◽  
pp. 1894-1912
Author(s):  
Samra Chaudary
Keyword(s):  
Investment Decision ◽  
Investment Decisions ◽  
Equation Modeling ◽  
Individual Investors ◽  
Short Term ◽  
Content Type ◽  
Multigroup Analysis ◽  
Money Managers ◽  
The Impact

Purpose The paper takes a behavioral approach by making use of the prospect theory to unveil the impact of salience on short-term and long-term investment decisions. This paper aims to investigate the group differences for two types of investors’ groups, i.e. individual investors and professional investors. Design/methodology/approach The study uses partial least square-based structural equation modeling technique, measurement invariance test and multigroup analysis test on a unique data set of 277 active equity traders which included professional money managers and individual investors. Findings Results showed that salience has a significant positive impact on both short-term and long-term investment decisions. The impact was almost 1.5 times higher for long-term investment decision as compared to short-term decision. Furthermore, multigroup analysis revealed that the two groups (individual investors and professional investors) were statistically significantly different from each other. Research limitations/implications The study has implications for financial regulators, money managers and individual investors as it was found that individual investors suffer more with salience heuristic and may end up with sub-optimal portfolios due to inefficient diversification. Thus, investors should be cautious in fully relying on salience and avoid such bias to improve investment returns. Practical implications The study concludes with a discussion of policy and regulatory implications on how to minimize salience bias to achieve optimum and diversified portfolios. Originality/value The study has significantly contributed to the growing body of applied behavioral research in the discipline of finance.

Family Estrangement

2013 ◽  
Author(s):  
Kylie Agllias
Keyword(s):  
Family System ◽  
Family Systems Theory ◽  
Structural Factors ◽  
Bowen Family Systems Theory ◽  
Political Awareness ◽  
Parental Alienation ◽  
Factors Affecting ◽  
The Family ◽  
Grief Responses ◽  
The Impact

Family estrangement—a concept similar to emotional cutoff in Bowen family systems theory—is the unsatisfactory physical or emotional distancing between at least two family members. It is attributed to a number of biological, psychological, social, and structural factors affecting the family, including attachment disorders, incompatible values and beliefs, unfulfilled expectations, critical life events and transitions, parental alienation, and ineffective communication patterns. Family estrangement is often experienced as a considerable loss; its ambiguous nature and social disenfranchisement can contribute to significant grief responses, perceived stigma, and social isolation in some cases. The social-work profession has a role to play in raising social and political awareness of the prevalence of, contributors to, and effects of estrangement on the intergenerational family, with clinicians working to assess and address the impact of estrangement on individuals and the family system.

Medical tourism in the COVID-19 era: opportunities, challenges and the way ahead

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Arvind Chhabra ◽  
Mehak Munjal ◽  
Prabhu Chandra Mishra ◽  
Kritika Singh ◽  
Debjanee Das ◽  
...  
Keyword(s):  
Medical Tourism ◽  
Healthcare Industry ◽  
Short Term ◽  
Indian Government ◽  
Content Type ◽  
Factors Affecting ◽  
Technological Advances ◽  
Negative Impacts ◽  
Novel Coronavirus ◽  
The Impact

PurposeThe novel coronavirus has not only caused significant illness and loss of life, it has caused major disruption at local, national and global levels. While the healthcare industry is experiencing growth during the pandemic, disruption to travel has affected medical tourism. This article considers the short-term factors affecting medical tourism and how they could be mitigated by incorporating technological advances to secure long-term growth.Design/methodology/approachThe study examines data provided by the Indian government as well as from non-government sources available in the public domain to review the impact of coronavirus disease 2019 (COVID-19) on medical tourism. The authors also examine data on technological advances in the healthcare industry that could help to reduce the impact of the pandemic.FindingsThis study’s findings show that while in-person services have been seriously impacted in the short term, technological adaptation of medical services to facilitate remote medical consultation has significantly increased. This has enlarged the business opportunities available to hospitals and general practitioners, and it could be leveraged to enhance medical tourism.Originality/valueThe article provides an analysis of the impact of the pandemic on medical tourism and how technology could be used to overcome short-term negative impacts and support longer-term development.

scholarly journals Impact of COVID-19 on Forecasting Stock Prices: An Integration of Stationary Wavelet Transform and Bidirectional Long Short-Term Memory

Complexity ◽  
2020 ◽  
Vol 2020 ◽  
pp. 1-12 ◽  
Author(s):  
Daniel Štifanić ◽  
Jelena Musulin ◽  
Adrijana Miočević ◽  
Sandi Baressi Šegota ◽  
Roman Šubić ◽  
...  
Keyword(s):  
Crude Oil ◽  
Stock Prices ◽  
Short Term Memory ◽  
Oil Price ◽  
Stationary Wavelet Transform ◽  
Crude Oil Price ◽  
Short Term ◽  
Term Memory ◽  
Long Short Term Memory ◽  
The Impact

COVID-19 is an infectious disease that mostly affects the respiratory system. At the time of this research being performed, there were more than 1.4 million cases of COVID-19, and one of the biggest anxieties is not just our health, but our livelihoods, too. In this research, authors investigate the impact of COVID-19 on the global economy, more specifically, the impact of COVID-19 on the financial movement of Crude Oil price and three US stock indexes: DJI, S&P 500, and NASDAQ Composite. The proposed system for predicting commodity and stock prices integrates the stationary wavelet transform (SWT) and bidirectional long short-term memory (BDLSTM) networks. Firstly, SWT is used to decompose the data into approximation and detail coefficients. After decomposition, data of Crude Oil price and stock market indexes along with COVID-19 confirmed cases were used as input variables for future price movement forecasting. As a result, the proposed system BDLSTM + WT-ADA achieved satisfactory results in terms of five-day Crude Oil price forecast.

scholarly journals Impact of Behavioral Factors in Making Investment Decisions and Performance: Evidence from Pakistan Stock Exchange

Market Forces ◽  
2021 ◽  
Vol 16 (1) ◽  
pp. 22
Author(s):  
Muhammad Rehan ◽  
Jahanzaib Alvi ◽  
Lubna Javed ◽  
Baber Saleem
Keyword(s):  
Decision Making ◽  
Behavioral Finance ◽  
Stock Exchange ◽  
Investment Decision ◽  
Investment Decisions ◽  
Individual Investors ◽  
Behavioral Factors ◽  
Factors Affecting ◽  
Investment Decision Making ◽  
The Impact

Market irregularities and irrational behavior triggered investor’s changes in the stock market, and this has led to an investigation into the impact of various behavioral biases and factors affecting decision-making for individual investors. The quality of individual investor behavior in making stock investment decisions is very important to be understood as a reference of the movement of the capital market. This study investigated the role of behavioral finance and investor psychology in investment decision-making at the Pakistan Stock Exchange (PSE). Using a sample of 147 individual investors, the study established that behavioral factors such as Herding, Heuristic, Market and Prospect that affected the decisions of the investors operating at the Pakistan Stock Exchange (PSE). As there are a few studies in Pakistan related to behavioral finance, so this study mainly contributes to the field of behavioral finance in Pakistan. This study focusses on existing theories of behavioral finance which led to develop the hypothesis. The result of the analysis is that the four variables have greatly influenced the investment decision and return on investment. All behavioral variables have a significant impact on the decision-making process of investors, which led to the acceptance of all assumptions regarding the level of influence of behavioral factors in decision making for individual investors

scholarly journals The impact of factors to profitability of some coal mining enterprises after vinacomin restructure project

2020 ◽  
Vol 61 (5) ◽  
pp. 97-103
Author(s):  
Trang Thu Pham ◽  
Keyword(s):  
Capital Structure ◽  
Coal Mining ◽  
Production Capacity ◽  
Regression Method ◽  
Short Term ◽  
Factors Affecting ◽  
Dupont Analysis ◽  
Mineral Industries ◽  
The Impact

The article uses Dupont analysis to determine the factors affecting profitability (ROE) of Vietnam coal mining enterprises and the regression method to examine the impact of production capacity of short-term assets, production capacity of long-term assets, production capacity of costs and capital structure on the profitability of firms. The article uses financial data collected from 19 coal mining companies of Vietnam National Coal-Mineral Industries Holding Corporation during the period of 2015 - 2018. The results show that production capacity of short-term assets, production capacity of long-term assets, production capacity of costs and capital structure positively impact profitability. The paper suggests 2 ways to improve profitability: firstly, borrowing to invest in technology will help coal mining enterprises improve their profitability; secondly, improving production processes appropriately to take full advantage of existing equipment capacity, thereby increasing profitability.

scholarly journals Pan(dem)ic Reactions in Turkish Stock Market: Evidence from share repurchases

2020 ◽  
Author(s):  
Burak Pirgaip
Keyword(s):  
Stock Returns ◽  
Stock Prices ◽  
Emerging Market ◽  
Policy Implications ◽  
Global Markets ◽  
Share Repurchases ◽  
Share Repurchase ◽  
Short Term ◽  
Financial Uncertainty ◽  
The Impact

Abstract Share repurchases have been widely used in global markets for years for various purposes such as to pay out cash, to stabilize stock prices, and so on. However, their use has recently been challenged due to the economic and financial uncertainty imposed by the COVID-19 outbreak. Not only governments have put bans or restrictions on the repurchasing transactions but also some major companies themselves have suspended their buyback programmes to preserve cash. On the other hand, repurchase activity has manifested itself in Turkish capital markets somewhat unexpectedly under uncertain market conditions. This study is one of the first attempts to explore the impact of share repurchase transactions on stock returns in an emerging market severely hit by COVID-19. Event study analyses reveal that market reaction to repurchase activity in the aftermath of the pandemic declaration of March 11, 2020 was significantly positive. Moreover, short-term stock performance of repurchasing firms was far greater than that of their non-repurchasing peers. These results have important policy implications in terms of corporate payout decisions which have recently been challenged by the new coronavirus.

scholarly journals The Impact of Divestment Announcements on the Share Price of Fossil Fuel Stocks

2019 ◽  
Vol 11 (11) ◽  
pp. 3122 ◽  
Author(s):  
Truzaar Dordi ◽  
Olaf Weber
Keyword(s):  
Stock Prices ◽  
Fossil Fuel ◽  
Statistical Tests ◽  
Price Change ◽  
Abnormal Returns ◽  
Efficient Market Hypothesis ◽  
Share Price ◽  
Short Term ◽  
Share Prices ◽  
The Impact

Several prominent institutional investors concerned about climate change have announced their intention or have divested from fossil fuel shares, to limit their exposure to the industry. The act of fossil fuel divestment may directly depress share prices or stigmatize the industry’s reputation, resulting in lower share value. While there has been considerable research conducted on the performance of the fossil fuel industry, there is not yet any empirical evidence that divestment announcements influence share prices. Adopting an event study methodology, this study measures abnormal deviations in stock prices of the top 200 global oil, gas, and coal companies by proven reserves, on days of prominent divestment announcements. Events are analyzed independently and in aggregate. The results make several notable contributions. While many events experienced short-term negative abnormal returns around the event day, the effects of events were more pronounced over longer event windows following the New York Climate March, suggesting a shift in investor perception. The results also find that divestment announcements related to campaigns, pledges, and endorsements all have a significant effect over the short-term event window. Finally, the results control for the general underperformance of the industry over the estimation window, attesting that the price change is caused by divestment announcements. Several robustness tests using alternate expected returns models and statistical tests were conducted to ensure the accuracy of the result. Overall, this study finds that divestment announcements decrease the share price of the fossil fuel companies, and thus, we conclude that ‘divestors’ can influence the share price of their target companies. Theoretically, the result adds new knowledge regarding the efficacy of the efficient market hypothesis in relation to divestment.

scholarly journals Factors Affecting The Jordanian Purchasing Behavior Of Housing Apartments: An Empirical Study In Irbid City

2016 ◽  
Vol 12 (7) ◽  
pp. 446
Author(s):  
Ibrahim Mohammed Khrais
Keyword(s):  
Influential Factors ◽  
Decision Making Process ◽  
Structural Factors ◽  
Purchasing Behavior ◽  
Land Area ◽  
Factors Affecting ◽  
Purchasing Decision ◽  
Per Capita ◽  
The Impact ◽  
Northern Jordan

The aim of this study is to show the extent of the impact of factors that affect the purchasing behavior of housing apartments per capita in Irbid city. It discusses the most influential factors in the purchasing decision for housing issues. These factors are independent factors: structural, geographical, environmental, and economical. Data was collected via questionnaires which were distributed to a sample of 150 individuals who are owners of apartments in Irbid city (Northern Jordan). The study showed different results and the various factors (structural, geographical, environmental, economical, and demographic) which have a significant impact on the purchasing decision of housing apartments in Irbid city. It is evident that these factors in full manner and the structural factors (construction area, land area, finishing, age of the building, and the outer shape) have an effect on the decision making process of the respective apartments.

Sign in / Sign up

Export Citation Format

Share Document