The contrarian strategy of institutional investors in Chinese stock market

Fenghua Wen, Qian Zou and Xiong Wang

Finance Research Letters, 2021, vol. 41, issue C

Abstract: Employing quarterly data of the change in institutional investors’ ownership, we investigate institutional behavior in Chinese stock market. The empirical results show that Chinese institutional investors generally adopt contrarian strategy, which is inconsistent with most studies. In particular, institutional investors are more inclined to show contrarian trading behavior in up markets. Furthermore, we find that the trading activities of institutional investors can positively predict future stock returns.

Keywords: Institutional investor; Contrarian strategy; Market states; Predictive ability (search for similar items in EconPapers)
JEL-codes: G11 G12 G20 (search for similar items in EconPapers)
Date: 2021
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (11)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:41:y:2021:i:c:s1544612320316597

DOI: 10.1016/j.frl.2020.101845

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