IDEAS home Printed from https://ideas.repec.org/a/wly/ijfiec/v23y2018i4p546-570.html
   My bibliography  Save this article

Investor sentiment and industry returns

Author

Listed:
  • Alexander Molchanov
  • Jeffrey Stangl

Abstract

This paper investigates the interaction between investor sentiment and industry performance. Investor sentiment has a widespread and systematic effect on performance, and predicts short‐term mispricing at industry level. Predictable long‐term reversals are weaker. We find limited evidence of cross‐sectional industry differences. Moreover, there is no relationship between investor sentiment and industry characteristics that proxy valuation uncertainty. Results generally show that investor sentiment has a market‐wide effect, questioning merit of industry timing strategy based on sentiment.

Suggested Citation

  • Alexander Molchanov & Jeffrey Stangl, 2018. "Investor sentiment and industry returns," International Journal of Finance & Economics, John Wiley & Sons, Ltd., vol. 23(4), pages 546-570, October.
    • Handle: RePEc:wly:ijfiec:v:23:y:2018:i:4:p:546-570
    DOI: 10.1002/ijfe.1637
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/ijfe.1637
    Download Restriction: no
    File URL: https://libkey.io/10.1002/ijfe.1637?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Yang, Haijun & Ge, Hengshun & Gao, Xinpeng, 2022. "An information diffusion model for momentum effect based on investor wealth," The North American Journal of Economics and Finance, Elsevier, vol. 59(C).
    2. Dahmene, Meriam & Boughrara, Adel & Slim, Skander, 2021. "Nonlinearity in stock returns: Do risk aversion, investor sentiment and, monetary policy shocks matter?," International Review of Economics & Finance, Elsevier, vol. 71(C), pages 676-699.
    3. Muhammad Ateeq ur REHMAN & Syed Ghulam Meran SHAH & Lucian-Ionel CIOCA & Alin ARTENE, 2021. "Accentuating the Impacts of Political News on the Stock Price, Working Capital and Performance: An Empirical Review of Emerging Economy," Journal for Economic Forecasting, Institute for Economic Forecasting, vol. 0(2), pages 55-73, June.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    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:wly:ijfiec:v:23:y:2018:i:4:p:546-570. See general information about how to correct material in RePEc.

    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.

    We have no bibliographic references for this item. You can help adding them by using 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: Wiley Content Delivery (email available below). General contact details of provider: http://www.interscience.wiley.com/jpages/1076-9307/ .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.