Peer Pressure: Social Interaction and the Disposition Effect

• 成果类型: Article
• 署名作者: Heimer, Rawley Z.
• 署名单位: Federal Reserve System - USA; Federal Reserve Bank - Cleveland
• 刊物名称: REVIEW OF FINANCIAL STUDIES
• ISSN/ISSBN: 0893-9454
• DOI: 10.1093/rfs/hhw063
• 发表日期: 2016
• 页码: 3177
• 关键词: STOCK-MARKET PARTICIPATION; Word-of-mouth; individual investors; prospect-theory; INFORMATION; trust; INVESTMENT; overconfidence; performance; decisions

摘要

Social interaction contributes to some traders' disposition effect. New data from an investment-specific social network linked to individual-level trading records builds evidence of this connection. To credibly estimate causal peer effects, I exploit the staggered entry of retail brokerages into partnerships with the social trading web platform and compare trader activity before and after exposure to these new social conditions. Access to the social network nearly doubles the magnitude of a trader's disposition effect. Traders connected in the network develop correlated levels of the disposition effect, a finding that can be replicated using workhorse data from a large discount brokerage.