Investor Competence, Trading Frequency, and Home Bias
Author
Abstract
Suggested Citation
DOI: 10.1287/mnsc.1090.1009
Download full text from publisher
Other versions of this item:
- John R. Graham & Campbell R. Harvey & Hai Huang, 2005. "Investor Competence, Trading Frequency, and Home Bias," NBER Working Papers 11426, National Bureau of Economic Research, Inc.
References listed on IDEAS
- Daniel Dorn & Gur Huberman, 2005.
"Talk and Action: What Individual Investors Say and What They Do,"
Review of Finance, Springer, vol. 9(4), pages 437-481, December.
- Daniel Dorn & Gur Huberman, 2005. "Talk and Action: What Individual Investors Say and What They Do," Review of Finance, European Finance Association, vol. 9(4), pages 437-481.
- Gervais, Simon & Odean, Terrance, 2001.
"Learning to be Overconfident,"
Review of Financial Studies, Society for Financial Studies, vol. 14(1), pages 1-27.
- Simon Gervais & Terrance Odean, "undated". "Learning To Be Overconfident," Rodney L. White Center for Financial Research Working Papers 5-97, Wharton School Rodney L. White Center for Financial Research.
- Simon Gervais & Terrance Odean, "undated". "Learning To Be Overconfident," Rodney L. White Center for Financial Research Working Papers 05-97, Wharton School Rodney L. White Center for Financial Research.
- Karen K. Lewis, 1999. "Trying to Explain Home Bias in Equities and Consumption," Journal of Economic Literature, American Economic Association, vol. 37(2), pages 571-608, June.
- Camerer, Colin F & Hogarth, Robin M, 1999.
"The Effects of Financial Incentives in Experiments: A Review and Capital-Labor-Production Framework,"
Journal of Risk and Uncertainty, Springer, vol. 19(1-3), pages 7-42, December.
- Camerer, Colin F. & Hogarth, Robin M., 1999. "The Effects of Financial Incentives in Experiments: A Review and Capital-Labor-Production Framework," Working Papers 1059, California Institute of Technology, Division of the Humanities and Social Sciences.
- Peter M. Demarzo & Ron Kaniel & Ilan Kremer, 2004. "Diversification as a Public Good: Community Effects in Portfolio Choice," Journal of Finance, American Finance Association, vol. 59(4), pages 1677-1716, August.
- Dahlquist, Magnus & Pinkowitz, Lee & Stulz, René M. & Williamson, Rohan, 2003.
"Corporate Governance and the Home Bias,"
Journal of Financial and Quantitative Analysis, Cambridge University Press, vol. 38(1), pages 87-110, March.
- Lee Pinkowitz & Rene M. Stulz & Rohan Williamson, 2001. "Corporate Governance and the Home Bias," NBER Working Papers 8680, National Bureau of Economic Research, Inc.
- Dahlquist, Magnus & Pinkowitz, Lee & Stulz, René M. & Williamson, Rohan, 2002. "Corporate Governance and the Home Bias," SIFR Research Report Series 11, Institute for Financial Research.
- Fox, Craig R. & Weber, Martin, 1999. "Ambiguity Aversion, Comparative Ignorance, and the Role of Context," Sonderforschungsbereich 504 Publications 99-47, Sonderforschungsbereich 504, Universität Mannheim;Sonderforschungsbereich 504, University of Mannheim.
- Kent Daniel & David Hirshleifer & Avanidhar Subrahmanyam, 1998. "Investor Psychology and Security Market Under- and Overreactions," Journal of Finance, American Finance Association, vol. 53(6), pages 1839-1885, December.
- Tesar, Linda L. & Werner, Ingrid M., 1995.
"Home bias and high turnover,"
Journal of International Money and Finance, Elsevier, vol. 14(4), pages 467-492, August.
- Linda L. Tesar & Ingrid M. Werner, 1992. "Home Bias and the High Turnover," NBER Working Papers 4218, National Bureau of Economic Research, Inc.
- Dahlquist, Magnus & Robertsson, Goran, 2001. "Direct foreign ownership, institutional investors, and firm characteristics," Journal of Financial Economics, Elsevier, vol. 59(3), pages 413-440, March.
- Camerer, Colin & Weber, Martin, 1992.
"Recent Developments in Modeling Preferences: Uncertainty and Ambiguity,"
Journal of Risk and Uncertainty, Springer, vol. 5(4), pages 325-370, October.
- Camerer, Colin F. & Weber, Martin, 1991. "Recent developments in modelling preferences: Uncertainty and ambiguitiy," Manuskripte aus den Instituten für Betriebswirtschaftslehre der Universität Kiel 275, Christian-Albrechts-Universität zu Kiel, Institut für Betriebswirtschaftslehre.
- Gur Huberman & Paul Sengmueller, 2004.
"Performance and Employer Stock in 401(k) Plans,"
Review of Finance, European Finance Association, vol. 8(3), pages 403-443.
- Gur Huberman & Paul Sengmueller, 2004. "Performance and Employer Stock in 401(k) Plans," Review of Finance, Springer, vol. 8(3), pages 403-443.
- White, Halbert, 1980. "A Heteroskedasticity-Consistent Covariance Matrix Estimator and a Direct Test for Heteroskedasticity," Econometrica, Econometric Society, vol. 48(4), pages 817-838, May.
- Massimo Massa & Andrei Simonov, 2006.
"Hedging, Familiarity and Portfolio Choice,"
Review of Financial Studies, Society for Financial Studies, vol. 19(2), pages 633-685.
- Massa, Massimo & Simonov, Andrei, 2004. "Hedging, Familiarity and Portfolio Choice," SIFR Research Report Series 21, Institute for Financial Research.
- Massa, Massimo & Simonov, Andrei, 2004. "Hedging, Familiarity and Portfolio Choice," CEPR Discussion Papers 4789, C.E.P.R. Discussion Papers.
- Baxter, Marianne & Jermann, Urban J, 1997.
"The International Diversification Puzzle Is Worse Than You Think,"
American Economic Review, American Economic Association, vol. 87(1), pages 170-180, March.
- Baxter, M. & Jermann, U.J., 1993. "The International Diversification Puzzle is Worse than you Think," RCER Working Papers 350, University of Rochester - Center for Economic Research (RCER).
- Marianne Baxter & Urban J. Jermann, 1995. "The International Diversification Puzzle is Worse Than You Think," NBER Working Papers 5019, National Bureau of Economic Research, Inc.
- Fox, Craig R. & Weber, Martin, 2002. "Ambiguity Aversion, Comparative Ignorance, and Decision Context," Organizational Behavior and Human Decision Processes, Elsevier, vol. 88(1), pages 476-498, May.
- Lei Feng & Mark S. Seasholes, 2004. "Correlated Trading and Location," Journal of Finance, American Finance Association, vol. 59(5), pages 2117-2144, October.
- Julie Agnew & Pierluigi Balduzzi & Annika Sundén, 2003. "Portfolio Choice and Trading in a Large 401(k) Plan," American Economic Review, American Economic Association, vol. 93(1), pages 193-215, March.
- French, Kenneth R & Poterba, James M, 1991.
"Investor Diversification and International Equity Markets,"
American Economic Review, American Economic Association, vol. 81(2), pages 222-226, May.
- Kenneth R. French & James M. Poterba, 1991. "Investor Diversification and International Equity Markets," NBER Working Papers 3609, National Bureau of Economic Research, Inc.
- Cooper, Ian & Kaplanis, Evi, 1994. "Home Bias in Equity Portfolios, Inflation Hedging, and International Capital Market Equilibrium," Review of Financial Studies, Society for Financial Studies, vol. 7(1), pages 45-60.
- Kyle, Albert S & Wang, F Albert, 1997. "Speculation Duopoly with Agreement to Disagree: Can Overconfidence Survive the Market Test?," Journal of Finance, American Finance Association, vol. 52(5), pages 2073-2090, December.
- Craig R. Fox & Amos Tversky, 1995. "Ambiguity Aversion and Comparative Ignorance," The Quarterly Journal of Economics, Oxford University Press, vol. 110(3), pages 585-603.
- Huberman, Gur, 2001. "Familiarity Breeds Investment," Review of Financial Studies, Society for Financial Studies, vol. 14(3), pages 659-680.
- Brad M. Barber & Terrance Odean, 2000. "Trading Is Hazardous to Your Wealth: The Common Stock Investment Performance of Individual Investors," Journal of Finance, American Finance Association, vol. 55(2), pages 773-806, April.
- Bruno Biais & Denis Hilton & Karine Mazurier & Sébastien Pouget, 2005.
"Judgemental Overconfidence, Self-Monitoring, and Trading Performance in an Experimental Financial Market,"
Review of Economic Studies, Oxford University Press, vol. 72(2), pages 287-312.
- Biais, Bruno & Hilton, Denis & Mazurier, Karine & Pouget, Sébastien, 2004. "Judgmental Overconfidence, Self-Monitoring and Trading Performance in an Experimental Financial Market," IDEI Working Papers 259, Institut d'Économie Industrielle (IDEI), Toulouse.
- Markus Glaser & Martin Weber, 2007.
"Overconfidence and trading volume,"
The Geneva Papers on Risk and Insurance Theory, Springer;International Association for the Study of Insurance Economics (The Geneva Association), vol. 32(1), pages 1-36, June.
- Markus Glaser & Martin Weber, 1990. "Overconfidence and trading volume," The Geneva Risk and Insurance Review, Palgrave Macmillan;International Association for the Study of Insurance Economics (The Geneva Association), vol. 32(1), pages 1-36, January.
- Glaser, Markus & Weber, Martin, 2003. "Overconfidence and trading volume," Papers 03-07, Sonderforschungsbreich 504.
- Glaser, Markus & Weber, Martin, 2003. "Overconfidence and Trading Volume," Sonderforschungsbereich 504 Publications 03-07, Sonderforschungsbereich 504, Universität Mannheim;Sonderforschungsbereich 504, University of Mannheim.
- Glaser, Markus & Weber, Martin, 2003. "Overconfidence and Trading Volume," CEPR Discussion Papers 3941, C.E.P.R. Discussion Papers.
- Glaser, Markus & Weber, Martin, 2005. "Overconfidence and Trading Volume," SIFR Research Report Series 40, Institute for Financial Research.
- Brad M. Barber & Terrance Odean, 2001. "Boys will be Boys: Gender, Overconfidence, and Common Stock Investment," The Quarterly Journal of Economics, Oxford University Press, vol. 116(1), pages 261-292.
- Chris Starmer, 2000. "Developments in Non-expected Utility Theory: The Hunt for a Descriptive Theory of Choice under Risk," Journal of Economic Literature, American Economic Association, vol. 38(2), pages 332-382, June.
- Brad M. Barber & Terrance Odean, 2002. "Online Investors: Do the Slow Die First?," Review of Financial Studies, Society for Financial Studies, vol. 15(2), pages 455-488, March.
- Shlomo Benartzi, 2001. "Excessive Extrapolation and the Allocation of 401(k) Accounts to Company Stock," Journal of Finance, American Finance Association, vol. 56(5), pages 1747-1764, October.
- Kent D. Daniel & David Hirshleifer & Avanidhar Subrahmanyam, 2001. "Overconfidence, Arbitrage, and Equilibrium Asset Pricing," Journal of Finance, American Finance Association, vol. 56(3), pages 921-965, June.
- Norman Strong & Xinzhong Xu, 2003. "Understanding the Equity Home Bias: Evidence from Survey Data," The Review of Economics and Statistics, MIT Press, vol. 85(2), pages 307-312, May.
- Joshua D. Coval & Tobias J. Moskowitz, 1999. "Home Bias at Home: Local Equity Preference in Domestic Portfolios," Journal of Finance, American Finance Association, vol. 54(6), pages 2045-2073, December.
- Joshua D. Coval & Tobias J. Moskowitz, 2001. "The Geography of Investment: Informed Trading and Asset Prices," Journal of Political Economy, University of Chicago Press, vol. 109(4), pages 811-841, August.
- Mark Grinblatt & Matti Keloharju, 2001. "How Distance, Language, and Culture Influence Stockholdings and Trades," Journal of Finance, American Finance Association, vol. 56(3), pages 1053-1073, June.
- Harris, Milton & Raviv, Artur, 1993. "Differences of Opinion Make a Horse Race," Review of Financial Studies, Society for Financial Studies, vol. 6(3), pages 473-506.
- Alok Kumar & Sonya Seongyeon Lim, 2008. "How Do Decision Frames Influence the Stock Investment Choices of Individual Investors?," Management Science, INFORMS, vol. 54(6), pages 1052-1064, June.
- Richard Deaves & Erik Lüders & Guo Ying Luo, 2009. "An Experimental Test of the Impact of Overconfidence and Gender on Trading Activity," Review of Finance, European Finance Association, vol. 13(3), pages 555-575.
- Heath, Chip & Tversky, Amos, 1991. "Preference and Belief: Ambiguity and Competence in Choice under Uncertainty," Journal of Risk and Uncertainty, Springer, vol. 4(1), pages 5-28, January.
- Terrance Odean, 1999. "Do Investors Trade Too Much?," American Economic Review, American Economic Association, vol. 89(5), pages 1279-1298, December.
- Valery Polkovnichenko, 2005. "Household Portfolio Diversification: A Case for Rank-Dependent Preferences," Review of Financial Studies, Society for Financial Studies, vol. 18(4), pages 1467-1502.
Most related items
These are the items that most often cite the same works as this one and are cited by the same works as this one.- Barber, Brad M. & Odean, Terrance, 2013. "The Behavior of Individual Investors," Handbook of the Economics of Finance, in: G.M. Constantinides & M. Harris & R. M. Stulz (ed.), Handbook of the Economics of Finance, volume 2, chapter 0, pages 1533-1570, Elsevier.
- Itzhak Venezia, 2018. "Lecture Notes in Behavioral Finance," World Scientific Books, World Scientific Publishing Co. Pte. Ltd., number 10751, June.
- Nicolas Coeurdacier & Hélène Rey, 2013.
"Home Bias in Open Economy Financial Macroeconomics,"
Journal of Economic Literature, American Economic Association, vol. 51(1), pages 63-115, March.
- Nicolas Coeurdacier & Hélène Rey, 2010. "Home bias in open economy financial macroeconomics," Sciences Po publications info:hdl:2441/c8dmi8nm4pd, Sciences Po.
- Coeurdacier, Nicolas & Rey, Hélène, 2012. "Home Bias in Open Economy Financial Macroeconomics," CEPR Discussion Papers 8746, C.E.P.R. Discussion Papers.
- Nicolas Coeurdacier & Hélène Rey, 2010. "Home bias in open economy financial macroeconomics," Working Papers hal-01069440, HAL.
- Nicolas Coeurdacier & Hélène Rey, 2013. "Home Bias in Open Economy Financial Macroeconomics," Post-Print hal-03473901, HAL.
- Nicolas Coeurdacier & Hélène Rey, 2011. "Home Bias in Open Economy Financial Macroeconomics," NBER Working Papers 17691, National Bureau of Economic Research, Inc.
- Nicolas Coeurdacier & Hélène Rey, 2013. "Home Bias in Open Economy Financial Macroeconomics," Sciences Po publications info:hdl:2441/1shj1p7td8e, Sciences Po.
- Francisco Gomes & Michael Haliassos & Tarun Ramadorai, 2021.
"Household Finance,"
Journal of Economic Literature, American Economic Association, vol. 59(3), pages 919-1000, September.
- Gomes, Francisco, 2020. "Household Finance," CEPR Discussion Papers 14502, C.E.P.R. Discussion Papers.
- Gomes, Francisco J. & Haliassos, Michael & Ramadorai, Tarun, 2020. "Household finance," IMFS Working Paper Series 138, Goethe University Frankfurt, Institute for Monetary and Financial Stability (IMFS).
- repec:hal:spmain:info:hdl:2441/c8dmi8nm4pdjkuc9g81p7j6b6 is not listed on IDEAS
- Guiso, Luigi & Sodini, Paolo, 2013.
"Household Finance: An Emerging Field,"
Handbook of the Economics of Finance, in: G.M. Constantinides & M. Harris & R. M. Stulz (ed.), Handbook of the Economics of Finance, volume 2, chapter 0, pages 1397-1532,
Elsevier.
- Luigi Guiso & Paolo Sodini, 2012. "Household Finance. An Emerging Field," EIEF Working Papers Series 1204, Einaudi Institute for Economics and Finance (EIEF), revised Mar 2012.
- Guiso, Luigi & Sodini, Paolo, 2012. "Household Finance: An Emerging Field," CEPR Discussion Papers 8934, C.E.P.R. Discussion Papers.
- David Hirshleife, 2015.
"Behavioral Finance,"
Annual Review of Financial Economics, Annual Reviews, vol. 7(1), pages 133-159, December.
- Hirshleifer, David, 2014. "Behavioral Finance," MPRA Paper 59028, University Library of Munich, Germany.
- Phelim Boyle & Lorenzo Garlappi & Raman Uppal & Tan Wang, 2012.
"Keynes Meets Markowitz: The Trade-Off Between Familiarity and Diversification,"
Management Science, INFORMS, vol. 58(2), pages 253-272, February.
- Boyle, Phelim & Garlappi, Lorenzo & Uppal, Raman & Wang, Tan, 2010. "Keynes Meets Markowitz: The Trade-off Between Familiarity and Diversification," CEPR Discussion Papers 7687, C.E.P.R. Discussion Papers.
- Abreu, Margarida & Mendes, Victor & Santos, João A.C., 2011.
"Home country bias: Does domestic experience help investors enter foreign markets?,"
Journal of Banking & Finance, Elsevier, vol. 35(9), pages 2330-2340, September.
- Margarida Abreu & Victor Mendes & João A. Santos, 2010. "Home Country Bias: Does Domestic Experience Help Investors Enter Foreign Markets?," Working Papers Department of Economics 2010/02, ISEG - Lisbon School of Economics and Management, Department of Economics, Universidade de Lisboa.
- repec:hal:spmain:info:hdl:2441/1shj1p7td8e0r5c9fcsnk8a91 is not listed on IDEAS
- Daniel, Kent & Hirshleifer, David & Teoh, Siew Hong, 2002. "Investor psychology in capital markets: evidence and policy implications," Journal of Monetary Economics, Elsevier, vol. 49(1), pages 139-209, January.
- John Y. Campbell, 2006.
"Household Finance,"
Journal of Finance, American Finance Association, vol. 61(4), pages 1553-1604, August.
- John Y. Campbell, 2006. "Household Finance," NBER Working Papers 12149, National Bureau of Economic Research, Inc.
- Campbell, John, 2006. "Household Finance," Scholarly Articles 3157877, Harvard University Department of Economics.
- Eduard Gaar & David Scherer & Dirk Schiereck, 2022. "The home bias and the local bias: A survey," Management Review Quarterly, Springer, vol. 72(1), pages 21-57, February.
- Markus Glaser & Martin Weber, 2007.
"Overconfidence and trading volume,"
The Geneva Papers on Risk and Insurance Theory, Springer;International Association for the Study of Insurance Economics (The Geneva Association), vol. 32(1), pages 1-36, June.
- Markus Glaser & Martin Weber, 1990. "Overconfidence and trading volume," The Geneva Risk and Insurance Review, Palgrave Macmillan;International Association for the Study of Insurance Economics (The Geneva Association), vol. 32(1), pages 1-36, January.
- Glaser, Markus & Weber, Martin, 2003. "Overconfidence and trading volume," Papers 03-07, Sonderforschungsbreich 504.
- Glaser, Markus & Weber, Martin, 2005. "Overconfidence and Trading Volume," SIFR Research Report Series 40, Institute for Financial Research.
- Glaser, Markus & Weber, Martin, 2003. "Overconfidence and Trading Volume," Sonderforschungsbereich 504 Publications 03-07, Sonderforschungsbereich 504, Universität Mannheim;Sonderforschungsbereich 504, University of Mannheim.
- Glaser, Markus & Weber, Martin, 2003. "Overconfidence and Trading Volume," CEPR Discussion Papers 3941, C.E.P.R. Discussion Papers.
- Glaser, Markus & Weber, Martin, 2009.
"Which past returns affect trading volume?,"
Journal of Financial Markets, Elsevier, vol. 12(1), pages 1-31, February.
- Glaser, Markus & Weber, Martin, 2005. "Which Past Returns Affect Trading Volume?," Sonderforschungsbereich 504 Publications 05-33, Sonderforschungsbereich 504, Universität Mannheim;Sonderforschungsbereich 504, University of Mannheim.
- Glaser, Markus & Weber, Martin, 2005. "Which Past Returns Affect Trading Volume?," SIFR Research Report Series 35, Institute for Financial Research.
- Anil Mishra, 2011. "Australia’s equity home bias and real exchange rate volatility," Review of Quantitative Finance and Accounting, Springer, vol. 37(2), pages 223-244, August.
- Lars Norden, 2010. "Individual home bias, portfolio churning and performance," The European Journal of Finance, Taylor & Francis Journals, vol. 16(4), pages 329-351.
- Baltzer, Markus & Stolper, Oscar & Walter, Andreas, 2011. "Home-field advantage or a matter of ambiguity aversion? Local bias among German individual investors," Discussion Paper Series 1: Economic Studies 2011,23, Deutsche Bundesbank.
- Michailova, Julija, 2010.
"Development of the overconfidence measurement instrument for the economic experiment,"
MPRA Paper
34799, University Library of Munich, Germany, revised Nov 2011.
- Michailova, Julija & Katter, Joana K. Q., 2013. "Thoughts on quantifying overconfidence in economic experiments," MPRA Paper 44399, University Library of Munich, Germany.
- Michailova, Julija & Katter, Joana K. Q., 2013. "Thoughts on quantifying overconfidence in economic experiments," MPRA Paper 53112, University Library of Munich, Germany, revised Jan 2014.
- Michailova, Julija, 2010. "Development of the overconfidence measurement instrument for the economic experiment," MPRA Paper 26384, University Library of Munich, Germany.
- Green, T. Clifton & Jame, Russell, 2013. "Company name fluency, investor recognition, and firm value," Journal of Financial Economics, Elsevier, vol. 109(3), pages 813-834.
- Hamberg, Mattias & Mavruk, Taylan & Sjögren, Stefan, 2013. "Investment allocation decisions, home bias and the mandatory IFRS adoption," Journal of International Money and Finance, Elsevier, vol. 36(C), pages 107-130.
- Liu, Hongqi & Peng, Cameron & Xiong, Wei A. & Xiong, Wei, 2022. "Taming the bias zoo," Journal of Financial Economics, Elsevier, vol. 143(2), pages 716-741.
More about this item
Keywords
behavioral finance; investment; competence; ambiguity; stock trading frequency; home bias;All these keywords.
JEL classification:
- G11 - Financial Economics - - General Financial Markets - - - Portfolio Choice; Investment Decisions
- G15 - Financial Economics - - General Financial Markets - - - International Financial Markets
- F30 - International Economics - - International Finance - - - General
Statistics
Access and download statisticsCorrections
All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:inm:ormnsc:v:55:y:2009:i:7:p:1094-1106. See general information about how to correct material in RePEc.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: . General contact details of provider: https://edirc.repec.org/data/inforea.html .
If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.
If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .
If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.
For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Chris Asher (email available below). General contact details of provider: https://edirc.repec.org/data/inforea.html .
Please note that corrections may take a couple of weeks to filter through the various RePEc services.