Do early birds behave differently from night owls in the stock market?

Grace Lepone and Zhini Yang

Pacific-Basin Finance Journal, 2020, vol. 61, issue C

Abstract: This study is the first to apply human beings' preferred diurnal rhythm, that is, morningness or eveningness, to the field of behavioural finance. Employing proprietary stock trading data from a leading retail brokerage house in Australia, we classify retail investors into M-types (‘early birds’) and E-types (‘night owls’) based on the time of their order submission. Demographic differences between the two groups (M-types or E-types) are found to be weak. We provide robust evidence that M-type investors are distinctively different from E-type investors in their proneness to stock market behavioural biases. We find that M-type investors trade more frequently and have a stronger preference for stock market speculation.

Keywords: Morningness-eveningness; Lottery stocks; Frequent trading; Speculation; Investor bias; Investor characteristics (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:pacfin:v:61:y:2020:i:c:s0927538x19305141

DOI: 10.1016/j.pacfin.2020.101333

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