Together we invest? Individual and institutional investors' trading behaviour in Poland

Goodfellow, Christiane; Bohl, Martin T.; Gębka, Bartosz

doi:10.1016/j.irfa.2009.03.002

Cited by 94 publications

(58 citation statements)

References 63 publications

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“…The latter paper finds no evidence that herding spills over across Chinese markets. Goodfellow et al (2009) report Polish institutional investors to be free from herding and their individual counterparts to herd mostly during market downswings and less over time. Chiang and Zheng (2010) analysed 18 countries around the globe and found herding to occur in advanced and Asian markets, especially when the market was moving up in the latter, but no (market-wide) herding in Latin American countries.…”

Section: Studies Based On Cross Sectional Return Dispersionmentioning

confidence: 99%

International herding: Does it differ across sectors?

Gębka

Wohar

2013

Journal of International Financial Markets, Institutions and Mo

103

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Section: Studies Based On Cross Sectional Return Dispersionmentioning

confidence: 99%

International herding: Does it differ across sectors?

Gębka

Wohar

2013

Journal of International Financial Markets, Institutions and Mo

103

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“…Early studies (Lakonishok et al, 1992;Grinblatt et al, 1995;Wermers, 1999) found limited evidence of herding among US funds while subsequent studies reported significant institutional herding in the US at the aggregate (Sias, 2004) and sector (Choi and Sias, 2009) levels. Significant herding has been detected among institutional investors in Germany (Kremer and Nautz, 2013), Portugal (Holmes et al, 2013) and Spain (Gavriilidis et al, 2013), yet not to that extent in Poland (Goodfellow et al, 2009) and the UK (Wylie, 2005). in the Italian market, while Gleason et al (2004) document no evidence of intraday herding among US exchange-traded funds.…”

Section: Introductionmentioning

confidence: 99%

Herding dynamics in exchange groups: Evidence from Euronext

Economou

Gavriilidis

Goyal

et al. 2015

Journal of International Financial Markets, Institutions and Mo

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 We examine whether joining an exchange group confers an effect over herding in the group's member-markets and if this effect persists when accounting for various domestic and international market states, the dynamics of the group's member-markets and the outbreak of financial crises  We test for the above in the context of the Euronext, which contains four equity markets (Belgium, France, the Netherlands and Portugal)  Herding is significant post-merger in all four markets; herding in Portugal is significant (yet less strong) pre-merger as well. These results are robust when controlling for various domestic/international market states and the dynamics of the group's markets  Herding following the outbreak of the euro-zone crisis is significant in Belgium, the Netherlands and Portugal, and is motivated by the dynamics of the group's two largest markets (France and the Netherlands). *Highlights (for review)Page 2 of 33 A c c e p t e d M a n u s c r i p t Herding Dynamics in Exchange Groups: Evidence from Euronext AbstractThis study investigates in the context of the Euronext, whether joining an exchange group affects herding in the group"s member-markets and if this effect persists when accounting for various domestic and international market states, the dynamics of the group"s member-markets and the outbreak of financial crises. We find that herding is significant post-merger in all four constituent equity markets (Belgium, France, the Netherlands and Portugal) of the Euronext, with herding in Portugal being significant (yet less strong) pre-merger as well. These results are robust when controlling for various domestic and international market states, as well as the dynamics of the group"s markets. The period following the outbreak of the euro-zone sovereign debt crisis produces significant herding in Belgium, the Netherlands and Portugal, with this herding being motivated by the dynamics of the group"s two largest markets (France and the Netherlands).JEL classification: G12, G15, G31

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“…In that case, low-ability professionals may follow the behavior of their high-ability peers for developing their performance [15]. According to Goodfellowa, Bohla and Gebkab [11] herding investors in the security market take their investment decisions based on the masses' decisions of buying and selling. On the contrary, informed and rational investors usually ignore following the decisions of masses, which makes the market efficient.…”

Section: Explanation Of Behavioral Finance Behind Bubble Burstmentioning

confidence: 99%

“…Investors, if they are more confident, rely more on private information for their investment decisions and therefore, be less interested in herding. On the other hand, when the amount of investment is large, the investors are most likely to follow the others' actions to reduce their risks [11]. Moreover, the choice of herding also depends on investors' category, for example, individual investors are more likely to follow the crowds in taking investment decision than institutional investors [11].…”

Section: Explanation Of Behavioral Finance Behind Bubble Burstmentioning

confidence: 99%

Stock Market Crash in Bangladesh: The Moneymaking Psychology of Domestic Investors

Rahman¹,

Hossain²,

Habibullah³

2017

AJTAB

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Abstract:After the cruel crash in 1996 Bangladesh stock market had started growing from 2006 due to listing of a few profitable government entities and Multinational Companies (MNCs). Together with individual investors nearly all commercial banks involved themselves intensely in stock market.Step by step, the bullish market transformed into a bubble and on December 05, 2010, the Dhaka Stock Exchange General Index (DGEN) reached at the record high of 8918.5, almost 5.6 times higher than December 2006. Concurrently, market capitalization and turnover increased by 11.1 times and 61.7 times respectively. However, when the bubble burst on December 19, 2010 the DGEN witnessed its biggest one day fall of 6.7 percent and since then the market has become bearish with almost no positive movement of stock prices. Against this backdrop, this study identified four moneymaking psychologies of domestic investors specifically greed, envy, speculation, and overconfidence that contributed to the formation of bubble, while four loss-minimizing and capital-protecting psychologies such as panic, frustration, lack of self-confidence, and distrust caused the bubble to burst. The bankers, brokers and manipulators were the biggest gainers, whereas the most unaware and greedy small investors encountered heavy loss. The market will be less volatile, more mature, and sustainable when most of the investors will be conscious about the potential risks and returns and the regulators will play their part sincerely and efficiently.

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Together we invest? Individual and institutional investors' trading behaviour in Poland

Cited by 94 publications

References 63 publications

International herding: Does it differ across sectors?

International herding: Does it differ across sectors?

Herding dynamics in exchange groups: Evidence from Euronext

Stock Market Crash in Bangladesh: The Moneymaking Psychology of Domestic Investors

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