Do Investors Buy Lotteries in China’s Stock Market?

Yu Liang and Weiqiang Zhang

Journal of Applied Finance & Banking, 2016, vol. 6, issue 5, 5

Abstract: Motivated by existing evidence of individual investors’ gambling preference in U.S. stock market (Kumar, 2009), this paper investigates characteristics of lottery-type stocks and individuals’ gambling preference in China’s stock market. Based on the practice situation of China’s stock market, this paper improves existing classification method and defines the lottery-type stocks as stocks with high MAX, high turnover rate, and low price. We show some unique characteristics of lottery-type stocks in China’s stock market. The distribution of lottery-type stocks in different industries is unbalanced, and the “lottery†feature is not permanent. The empirical results indicate that individual investors overweight stocks with lottery features in China’s stock market. Further, we find that individual investors exhibit a stronger gambling preference in the bull market.

Date: 2016
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
http://www.scienpress.com/Upload/JAFB%2fVol%206_5_5.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:spt:apfiba:v:6:y:2016:i:5:f:6_5_5

Access Statistics for this article

More articles in Journal of Applied Finance & Banking from SCIENPRESS Ltd
Bibliographic data for series maintained by Eleftherios Spyromitros-Xioufis ().