Investment Behaviour of Analysts: A Case Study of Pakistan Stock Exchange

Salman Ahmed Shaikh ()

Journal of Finance and Accounting Research, 2019, vol. 1, issue 1, 52-69

Abstract: Security prices in efficient markets reflect all relevant information. Past price formations and even fundamental analysis cannot guarantee abnormal returns consistently to any pre-identified strategy or market participant, be they novice or expert traders. There have been various studies conducted with the aim to test market efficiency in emerging markets. However, in this study, we have surveyed the professional investment community and have studied their stated actions in making investments. Our results indicate the prevalence of herding and overconfidence in professional analysts. We also found that analysts extrapolate the past into future forecasts. We also discovered an association between demographic characteristics and the choice of security valuation methods that the analysts use. In line with Chevalier and Ellison (1998), we found that younger analysts herd less than the older ones.

Keywords: Investment behaviour; behavioural finance; herding; mutual funds; security analysis; CAPM; technical analysis (search for similar items in EconPapers)
JEL-codes: G02 G11 G12 G14 (search for similar items in EconPapers)
Date: 2019
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Citations: View citations in EconPapers (1)

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