Investors' personal characteristics and trading decisions under distressed market conditions

Liron Reiter-Gavish; Mahmoud Qadan; Joseph Yagil

doi:10.1016/j.bir.2021.04.005

Investors' personal characteristics and trading decisions under distressed market conditions

Liron Reiter-Gavish, Mahmoud Qadan, Joseph Yagil

School Of Business Administration

Research output: Contribution to journal › Article › peer-review

Abstract

Using data for about 50,000 actual household investment accounts, we document that financial advice reduced investors’ tendency to leave the stock market during the market crash of 2008 and had a positive correlation with their decisions to return to the market. In addition, we provide a comprehensive analysis of the role of investors' economic and demographic characteristics in their decision to sell all of their portfolio securities, or in contrast, to hold or even increase the value of their portfolio. Finally, we find that being divorced increases the probability of leaving the market, while singles are less likely to leave the market during a crisis.

Original language	English
Pages (from-to)	240-247
Number of pages	8
Journal	Borsa Istanbul Review
Volume	22
Issue number	2
DOIs	https://doi.org/10.1016/j.bir.2021.04.005
State	Published - 2021

Bibliographical note

Publisher Copyright:
© 2021 The Authors

Keywords

Household finance
Investor literacy
Investor sophistication
Subprime crises
Use of advice

ASJC Scopus subject areas

Finance
Economics and Econometrics

UN SDGs

This output contributes to the following UN Sustainable Development Goals (SDGs)

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10.1016/j.bir.2021.04.005

Cite this

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abstract = "Using data for about 50,000 actual household investment accounts, we document that financial advice reduced investors{\textquoteright} tendency to leave the stock market during the market crash of 2008 and had a positive correlation with their decisions to return to the market. In addition, we provide a comprehensive analysis of the role of investors' economic and demographic characteristics in their decision to sell all of their portfolio securities, or in contrast, to hold or even increase the value of their portfolio. Finally, we find that being divorced increases the probability of leaving the market, while singles are less likely to leave the market during a crisis.",

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N2 - Using data for about 50,000 actual household investment accounts, we document that financial advice reduced investors’ tendency to leave the stock market during the market crash of 2008 and had a positive correlation with their decisions to return to the market. In addition, we provide a comprehensive analysis of the role of investors' economic and demographic characteristics in their decision to sell all of their portfolio securities, or in contrast, to hold or even increase the value of their portfolio. Finally, we find that being divorced increases the probability of leaving the market, while singles are less likely to leave the market during a crisis.

AB - Using data for about 50,000 actual household investment accounts, we document that financial advice reduced investors’ tendency to leave the stock market during the market crash of 2008 and had a positive correlation with their decisions to return to the market. In addition, we provide a comprehensive analysis of the role of investors' economic and demographic characteristics in their decision to sell all of their portfolio securities, or in contrast, to hold or even increase the value of their portfolio. Finally, we find that being divorced increases the probability of leaving the market, while singles are less likely to leave the market during a crisis.

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KW - Investor sophistication

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ER -

Investors' personal characteristics and trading decisions under distressed market conditions

Abstract

Bibliographical note

Keywords

ASJC Scopus subject areas

UN SDGs

Access to Document

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