We introduce a simple and highly portable measure capturing the impact of price path visualizations on investor behavior, beliefs, and financial market outcomes: the visual shape score (VSS). The score reflects the degree of convexity of a price path. Although VSS is only a single metric, it...

We apply a machine-learning algorithm calibrated from general human vision to predict visual salience of parts of a stock price series. We hypothesize that visual salience of adjacent prices increases decision weights on returns computed from those prices. We analyze the inferred decision impact...

We establish a direct link between the idiosyncratic volatility (IVol) puzzle and the behavior of sophisticated and private investors. To do so, we employ three option-based measures of informed trading and attention data from Google Trends. Our analyses show that the IVol puzzle is particularly...

Systematic mispricing primarily affects speculative stocks and predominantly results in overpricing, predicting lower average returns. Because speculative stocks overlap with stocks deemed risky by rational models, failing to control for exposure to systematic mispricing can bias tests of...

Experimental evidence shows that recent observations have a stronger impact on the formation of beliefs than observations from the more distant past. Thus, if investors judge upon a stock's attractiveness based on historical return data, they presumably overweight the most recent returns. Based...