Lucky lots and unlucky investors

Tao CHEN; Andreas KARATHANASOPOULOS; Stanley Iat Meng KO; Chia Chun LO

doi:10.1007/s11156-019-00805-8

Lucky lots and unlucky investors

Tao CHEN
, Andreas KARATHANASOPOULOS
, Stanley Iat Meng KO^*
, Chia Chun LO

^*Corresponding author for this work

Research output: Journal Publications › Journal Article (refereed) › peer-review

7 Citations (Scopus)

Abstract

The number 8 is considered lucky under the Chinese culture. This paper tries to examine whether investors hold such superstitious belief in the Hong Kong Stock Exchange. Using the transaction level data, we first show that more intense net buying occurs at 8-ending lots. Next, we seek favorable evidence in support of financial complexity hypothesis and informed trading hypothesis, both of which are effective in expounding the prevalence of this biased trading behavior. Finally, we find that traders’ learning by means of information acquisition is able to alleviate the lucky-8 effect on superstitious traders.

Original language	English
Pages (from-to)	735-751
Number of pages	17
Journal	Review of Quantitative Finance and Accounting
Volume	54
Issue number	2
Early online date	14 Mar 2019
DOIs	https://doi.org/10.1007/s11156-019-00805-8
Publication status	Published - Feb 2020
Externally published	Yes

Bibliographical note

Publisher Copyright:
© 2019, Springer Science+Business Media, LLC, part of Springer Nature.

Funding

We thank Cheng-Few Lee (Editor) and anonymous referees for their helpful comments and suggestions. Chen acknowledges the Start-up Research Grant (SRG2018-00115-FBA) support from University of Macau. Ko thanks the financial support of the Multi-Year Research Grant (MYRG2017-00086-FBA) to University of Macau. All errors remain our own responsibility.

Keywords

Learning effects
Lot sizes
Lucky numbers
Trading biases

Access to Document

10.1007/s11156-019-00805-8

Cite this

@article{81dfc87d05df47f1be46592797e8a2a0,

title = "Lucky lots and unlucky investors",

abstract = "The number 8 is considered lucky under the Chinese culture. This paper tries to examine whether investors hold such superstitious belief in the Hong Kong Stock Exchange. Using the transaction level data, we first show that more intense net buying occurs at 8-ending lots. Next, we seek favorable evidence in support of financial complexity hypothesis and informed trading hypothesis, both of which are effective in expounding the prevalence of this biased trading behavior. Finally, we find that traders{\textquoteright} learning by means of information acquisition is able to alleviate the lucky-8 effect on superstitious traders.",

keywords = "Learning effects, Lot sizes, Lucky numbers, Trading biases",

author = "Tao CHEN and Andreas KARATHANASOPOULOS and KO, \{Stanley Iat Meng\} and LO, \{Chia Chun\}",

note = "Publisher Copyright: {\textcopyright} 2019, Springer Science+Business Media, LLC, part of Springer Nature.",

year = "2020",

month = feb,

doi = "10.1007/s11156-019-00805-8",

language = "English",

volume = "54",

pages = "735--751",

journal = "Review of Quantitative Finance and Accounting",

issn = "0924-865X",

publisher = "Springer New York",

number = "2",

}

TY - JOUR

T1 - Lucky lots and unlucky investors

AU - CHEN, Tao

AU - KARATHANASOPOULOS, Andreas

AU - KO, Stanley Iat Meng

AU - LO, Chia Chun

PY - 2020/2

Y1 - 2020/2

N2 - The number 8 is considered lucky under the Chinese culture. This paper tries to examine whether investors hold such superstitious belief in the Hong Kong Stock Exchange. Using the transaction level data, we first show that more intense net buying occurs at 8-ending lots. Next, we seek favorable evidence in support of financial complexity hypothesis and informed trading hypothesis, both of which are effective in expounding the prevalence of this biased trading behavior. Finally, we find that traders’ learning by means of information acquisition is able to alleviate the lucky-8 effect on superstitious traders.

AB - The number 8 is considered lucky under the Chinese culture. This paper tries to examine whether investors hold such superstitious belief in the Hong Kong Stock Exchange. Using the transaction level data, we first show that more intense net buying occurs at 8-ending lots. Next, we seek favorable evidence in support of financial complexity hypothesis and informed trading hypothesis, both of which are effective in expounding the prevalence of this biased trading behavior. Finally, we find that traders’ learning by means of information acquisition is able to alleviate the lucky-8 effect on superstitious traders.

KW - Learning effects

KW - Lot sizes

KW - Lucky numbers

KW - Trading biases

UR - https://www.scopus.com/pages/publications/85063045428

U2 - 10.1007/s11156-019-00805-8

DO - 10.1007/s11156-019-00805-8

M3 - Journal Article (refereed)

AN - SCOPUS:85063045428

SN - 0924-865X

VL - 54

SP - 735

EP - 751

JO - Review of Quantitative Finance and Accounting

JF - Review of Quantitative Finance and Accounting

IS - 2

ER -

Lucky lots and unlucky investors

Abstract

Bibliographical note

Funding

Keywords

Access to Document

Other files and links

Cite this