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This short paper shows how excess global saving led to asset price inflation in U.S. stocks during 1981 to 2019. It compares stock PE ratios to corporate bond values to explain that investor exuberance for stocks enabled and enhanced the extent of the secular stock rise
Persistent link: https://www.econbiz.de/10012840941
In this paper we investigate the importance of acquaintance networks for financial decisions by households. We construct a variable capturing the expected proximity or social closeness to a subpopulation of financially savvy people using an overdispersed Poisson model. This measure captures the...
Persistent link: https://www.econbiz.de/10012991634
Anecdotal evidence suggests that investor protection affects the demand for equity, but existing theories emphasize only the effect of investor protection on the supply of equity. We build a model showing that the demand for equity is important in explaining financial development. If the level...
Persistent link: https://www.econbiz.de/10009502217
It is a universally accepted principle that risk and return of investing are commensurate. However, people give more importance to return and risk takes a back seat. This study is an attempt to understand the perceptions of 120 investors in Gandhinagar region towards risk and return of investing...
Persistent link: https://www.econbiz.de/10013027276
In this paper, we empirically investigate warrant price behavior in the Chinese market – the largest warrant market in the world in terms of trading volume since 2006. By examining warrant return properties, volatility behavior, and pricing errors, we document a stylized fact that call...
Persistent link: https://www.econbiz.de/10013099649
that in transition economies such as China, controlling shareholders usually have a strong incentive to disclose poor …
Persistent link: https://www.econbiz.de/10013008353
China's stock market has grown rapidly since its introduction in 1991 and it has become one of the world's leading …
Persistent link: https://www.econbiz.de/10013029367
newly opened brokerage accounts in China and tests the role of new investors in bubble formation. I find that new investors …
Persistent link: https://www.econbiz.de/10011893651
We analyze the stock market return predictability for three different periods. We evaluate the conditional variance (CV) and the variance risk premium (VRP) as predictors of stock market returns for which we are using well-established versions of the heterogeneous auto-regressive (HAR) model and...
Persistent link: https://www.econbiz.de/10012832030
A conjecture in the literature holds that a large and diversified investor base leads to lower volatility by improving the quality of the price signal. In this paper this hypothesis is examined using unique Swedish ownership data. The data does not support the conjecture. Instead, volatility...
Persistent link: https://www.econbiz.de/10012990075