Do investors herd under global crises? A comparative study between Chinese and the United States stock markets

Shuo Xing, Tingting Cheng and Shuanglin Sun

Finance Research Letters, 2024, vol. 62, issue PA

Abstract: This paper investigates the impact of two global crises, the global financial crisis and the COVID-19 crisis, on herding behavior in the Chinese and U.S. stock markets. We find no evidence of herding behavior during these two global crises in the U.S. stock market, yet significant herding emerges under the COVID-19 crisis in Chinese mainland stock market. Additionally, the observed herding behavior in mainland China is primarily driven by sentiment. Our results reveal and explain the differences in the effects of financial crisis and public health crisis on herding behavior, as well as variations between emerging and developed stock markets.

Keywords: Global crisis; Herding behavior; Stock markets (search for similar items in EconPapers)
JEL-codes: C5 G10 G23 (search for similar items in EconPapers)
Date: 2024
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:finlet:v:62:y:2024:i:pa:s1544612324001508

DOI: 10.1016/j.frl.2024.105120

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