Examining the time of entry into the stock market and the effect of the desire of small investors of companies admitted to the stock exchange
Seyed Farzad Hashemi
1
(
Assistant Professor, Department of Management, Islamic Azad University, Shahr-Quds Branch, Iran
)
Mohammad Karbalaei
2
(
Graduated from the Department of Management, Faculty of Humanities, Islamic Azad University, Shahr-Quds Branch, Iran
)
Keywords: Stock market, retail investors, investment risk,
Abstract :
The purpose of this research is to investigate the time of entry into the stock market and the effect of the desire of retail investors. Using a unique dataset of account-level transaction records from a large brokerage firm, we find strong evidence of a positive effect of retail investors. Studies show that investors exhibit a stronger propensity effect if they initially participate in the stock market during periods of lower returns, lower investor sentiment, higher market volatility, or higher economic policy uncertainty. In fact, this research is carried out by analyzing the companies admitted to the Tehran Stock Exchange in the period of 2018-2018. The statistical sample of the research consists of 109 companies. Data analysis has been carried out with the help of Eviews10 software. In order to investigate the simultaneous effects of all the independent variables of the research on the dependent variable, in addition to the separate regression of each of the independent variables, a general regression of the variables was also performed. The findings and results of the research show that retail investors have a positive effect on common psychological characteristics and lower returns on the stock market, in the meantime, the results of these studies show that the use of more market fluctuations potentially indicates capital risk. More importantly, in this research, we argue that investors' different initial experiences of market risk have an intrinsic effect on their subsequent understanding of risk and therefore influence them.
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