The influence of mobile trading on return dispersion and herding behavior

Zhuolei Li, Xundi Diao and Chongfeng Wu

Pacific-Basin Finance Journal, 2022, vol. 73, issue C

Abstract: Combining behavioral finance and asset pricing theory, we propose a modified empirical model to examine equity return dispersion and herding behavior. We verify the effectiveness of risk factors in explaining market dispersion and study how mobile trading is related to market dispersion and herding behaviors. Our findings indicate that mobile trading would make the market herd more, and the effect is not driven by mobile traders’ characteristic preferences or the market bubble and crash. Besides, our results support a different composition of mobile traders after a policy change on trading accounts, and this difference leads to the opposite impact of mobile trading on return dispersion after 2015.

Keywords: Fintech; Herding behavior; Mobile trading; Factor model (search for similar items in EconPapers)
JEL-codes: G10 G14 G40 (search for similar items in EconPapers)
Date: 2022
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:pacfin:v:73:y:2022:i:c:s0927538x22000622

DOI: 10.1016/j.pacfin.2022.101767

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