The gambler’s and hot-hand fallacies: Empirical evidence from trading data

Matthias Pelster

Economics Letters, 2020, vol. 187, issue C

Abstract: I test the prediction of Rabin and Vayanos (2010) that a belief in continuation of streaks should be observed following long streaks, while a belief in reversals should be observed following short streaks. Using a unique sample of retail investor trading data, the paper provides novel empirical evidence on the gambler’s and hot-hand fallacies.

Keywords: Gambler’s fallacy; Hot-hand fallacy; Representativeness; Retail investors (search for similar items in EconPapers)
JEL-codes: D14 G11 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:ecolet:v:187:y:2020:i:c:s0165176519304471

DOI: 10.1016/j.econlet.2019.108887

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