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To sell or not to sell? Behavior of shareholders during price collapses

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  • Bertrand M. Roehner

Abstract

It is a common belief that the behavior of shareholders depends upon the direction of price fluctuations: if prices increase they buy, if prices decrease they sell. That belief, however, is more based on ``common sense'' than on facts. In this paper we present evidence for a specific class of shareholders which shows that the actual behavior of shareholders can be markedly different.

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  • Bertrand M. Roehner, 2001. "To sell or not to sell? Behavior of shareholders during price collapses," Papers cond-mat/0102042, arXiv.org.
    • Handle: RePEc:arx:papers:cond-mat/0102042
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    1. Stauffer, Dietrich & Sornette, Didier, 1999. "Self-organized percolation model for stock market fluctuations," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 271(3), pages 496-506.
    2. Cont, Rama & Bouchaud, Jean-Philipe, 2000. "Herd Behavior And Aggregate Fluctuations In Financial Markets," Macroeconomic Dynamics, Cambridge University Press, vol. 4(2), pages 170-196, June.
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