To Be Good or To Be Better: Asset Managers Attitudes Towards Herding
AbstractBased on a questionnaire survey the paper distinguishes between herding asset managers who try to be good and non-herding asset managers who try to be better than their competitors. It provides evidence for reputational herding and discusses herding managers\\\' working effort, preferred sources of information and investment horizon. Additionally, their risk taking behavior including their investment behavior in short-term tournament scenarios is analyzed. It is found that herding managers assess themselves as generally more risk averse than non-herding managers, but in the tournament they are willing to take more risk. This finding is ascribable to their fear of falling out of the herd.
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Bibliographic InfoPaper provided by Leibniz Universität Hannover, Wirtschaftswissenschaftliche Fakultät in its series Hannover Economic Papers (HEP) with number dp-297.
Length: 25 pages
Date of creation: May 2004
Date of revision:
Institutional investors; herding; risk aversion; tournament hypothesis;
Find related papers by JEL classification:
- G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading
- G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
This paper has been announced in the following NEP Reports:
- NEP-ALL-2004-06-02 (All new papers)
- NEP-CBE-2004-06-02 (Cognitive & Behavioural Economics)
- NEP-CFN-2004-06-02 (Corporate Finance)
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