Herding behavior in Chinese stock markets: An examination of A and B shares

Analysis of Herd Behavior Using Quantile Regression: Evidence from Karachi Stock Exchange (KSE)

“…As Karachi Stock Exchange is an emerging stock market therefore, to that extent, these results are consistent with their results. These results are consistent with those reported by Chiang, Li and Tan, (2010) ;Tan, Chiang, Mason and Nelling, (2008) that herd behavior exist in the Chinese market. Chiang, Li and Tan, (2010) found herding behavior in A-share markets.…”

“…Therefore, the results show that herd behavior exist in both bullish and bearish markets.. These results are also consistent with Tan et al (2008) and partially consistent as reported by Chiang, Liand Tan, (2010), the former reported herding in both under bullish and bearish markets while the later found herding in only A-share market under both bullish and bearish markets and B-share market investors herd only in bearish market.…”

“…Chiang, Li and Tan, (2010) found herding behavior in A-share markets. Tan, Chiang, Mason, and Nelling, (2008) found herding behavior in dual-listed B-shares in the Chinese equity market. These results are in contrast with Demirer and Kutan, (2006) who studied daily returns of 375 companies and were unable to find herding.…”

Would the Reputation and Behaviour of the Chinese Stock Exchange Be a Disincentive to Investors Considering a Chinese Reit?

“…However, despite 75% of Group A knowing how to invest in exchanges outside China, only 63% perceived the Hong Kong and Singapore exchanges as conveniently accessible: the remainder thought them difficult to access. In contrast, it is easy for Chinese domiciled investors to access the Shanghai market, indeed the high levels of retail investor involvement are well-recognised and contribute to its volatility (Comerton-Forde & Ridge, 2005, Tan et al, 2008, Lee, Li & Wang, 2010. The difficulty of access accords with the segmentation of the mainland Chinese markets from those in Singapore and Hong Kong identified by Wang and di Iorio (2006).…”

“…They assessed the Hong Kong Exchange as highly transparent. Tan et al (2008) showed that the Chinese A share markets exhibit investor herding behaviour over short time horizons, which was stronger in rising markets, with high trading volumes and price volatility. This was not true for B shares, suggesting it is probably due to dominance of the A share market by individual domestic investors.…”