How “Point Blindness” Dilutes the Value of Stock Market Reports

Arthur Lupia (), Yanna Krupnikov, Adam Seth Levine, Cassandra Grafstrom, William MacMillan () and Erin McGovern

MPRA Paper from University Library of Munich, Germany

Abstract: The stock index “point” is a focal component of financial news reports. While much attention is paid to changes in stock index point totals, few people realize that the value of a stock index “point” varies (and has recently declined). We call this perceptual phenomenon “point blindness” and explain its threat to investors. Simple changes in media presentations of stock index information can counter point blindness. These changes are easy to implement and can help audiences make better financial decisions. An experiment on over 2000 participants shows such changes significantly altering their perceptions of the stock market.

Keywords: behavioral economics: personal finance; communication (search for similar items in EconPapers)
JEL-codes: C99 D14 G11 (search for similar items in EconPapers)
Date: 2008-07-17
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https://mpra.ub.uni-muenchen.de/9612/1/MPRA_paper_9612.pdf original version (application/pdf)

Related works:
Working Paper: How “Point Blindness” Dilutes the Value of Stock Market Reports (2008)
Working Paper: How “Point Blindness” Dilutes the Value of Stock Market Reports (2008)
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:9612

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