Retail Investor Industry Herding

Using minute-by-minute TV advertising data covering some 300 firms, 327,000 ads, and $20 billion in ad spending, we study the real-time effects of TV advertising on investors’ searches for online financial information and subsequent trading activity. Our identification strategy exploits the fact that viewers in different U.S. time zones are exposed to the same programming and national advertising at different times, allowing us to control for contemporaneous confounding events. We find that an average TV ad leads to a 3% increase in EDGAR (Electronic Data Gathering, Analysis, and Retrieval) system queries and an 8% increase in Google searches for financial information within 15 minutes of the airing of that ad. These searches translate into larger trading volume on the advertiser’s stock, driven primarily by retail investors. The findings on retail investor ad-induced trading are corroborated with hourly data from Robinhood, a popular retail trading platform. We also show that ads induce searches and trading of companies other than the advertiser, including of close rivals. Altogether, our findings suggest that advertising originally intended for consumers has a nonnegligible effect on financial markets. This paper was accepted by Karl Diether, finance.

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The Democratization of Investment Research and the Informativeness of Retail Investor Trading

Journal of Financial Economics ◽

10.1016/j.jfineco.2021.07.018 ◽

2021 ◽

Author(s):

Michael Farrell ◽

T. Clifton Green ◽

Russell Jame ◽

Stanimir Markov

Keyword(s):

Retail Investor ◽

Investor Trading

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Tracking Retail Investor Activity

SSRN Electronic Journal ◽

10.2139/ssrn.2822105 ◽

2017 ◽

Cited By ~ 28

Author(s):

Ekkehart Boehmer ◽

Charles M. Jones ◽

Xiaoyan Zhang

Keyword(s):

Retail Investor

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Faktor-Faktor Yang Dipertimbangkan Investor Dalam Melakukan Investasi

Jurnal Manajemen Teori dan Terapan | Journal of Theory and Applied Management ◽

10.20473/jmtt.v4i3.2424 ◽

2011 ◽

Vol 4 (3) ◽

Author(s):

Linda Ariany Mahastanti

Keyword(s):

Educational Level ◽

Investment Decision ◽

Investment Decisions ◽

Demographic Variables ◽

Investor Behavior ◽

Primary Data ◽

High Educational Level ◽

Behavioral Variables ◽

Retail Investor ◽

Economic Perspectives

Investor has many options in an investment with the current number of investment instruments. Previous studies of retail investor behavior have examined motivation from economic perspectives or studied relationships between economic, behavioral and demographic variables. Examination of the various utility-maximization and behavioral variables underlying individual investor behavior provides a more comprehensive understanding of the investment decision process. This research will examine the seven factors that considered investors' decisions to invest, and investor behavior in taking the decision to invest. The data used are primary data that obtained by sending questionnaires through via email at Danareksa investors domiciled in Salatiga and Semarang. The analysis method used is tabulation frequencies and cross tabulation (Crosstab). Based on the results of the research, it is known that the factors that considered investor' decisions is Neutral Information and Accounting Information factor. For the result of demographic aspects effect research against investment decision is investor who are aged 25-29 and 50-54 years which is considered all of the factors. While for sex, female consider many factors than male. For educational level with high educational level makes the investor pay attention to the factors that associated with investment decisions, and investors who invest for 1-3 years old considering many factors before making investment decisions.

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What is your desire? Retail investor preferences in structured products

Review of Behavioral Finance ◽

10.1108/rbf-10-2020-0254 ◽

2021 ◽

Vol ahead-of-print (ahead-of-print) ◽

Author(s):

Rainer Baule ◽

Patrick Muenchhalfen

Keyword(s):

Design Methodology ◽

Recent Literature ◽

Product Structure ◽

Content Type ◽

Financial Products ◽

Retail Investors ◽

Retail Investor ◽

Retail Products ◽

Structured Financial Products ◽

Insight Into

PurposeThe authors evaluate the preferences of retail investors with regard to the investment in structured financial products. The purpose of the paper is an analysis of the relative importance of key product attributes namely the issuing bank, the product structure, the associated costs and the disclosed risk.Design/methodology/approachThe authors conduct a choice-based conjoint analysis, based on an online experiment. Participants judge their preferences for products which are presented by shortened key information documents according to the requirements of EU regulation.FindingsInvestors consider the costs and the product structure to be most important, whereas the issuer and information on risk are of less interest. Their preferences depend on their (self-evaluated) expertise: while inexperienced retail investors concentrate on costs, experienced investors pay more attention to the product structure.Research limitations/implicationsThe study is limited to a subsegment of the market, the discount certificates. For these products, issuing banks gain insight into the attractiveness of their products. Furthermore, the study carries implications for regulators: since investors emphasize the costs in their decisions, an unbiased disclosure of costs should be enforced.Originality/valueWhile the recent literature has studied preferences for the investment in mutual funds, this is the first paper which directly analyzes the drivers of an investment in structured retail products.

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