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Technological progress in recent years has made new methods available for making forecasts in a variety of areas. We examine the success of ex-ante stock market forecasts of three major stock market indices, i.e., the German Stock Market Index (DAX), the Dow Jones Industrial Index (DJI), and the...
Persistent link: https://www.econbiz.de/10012799168
We investigate how individuals use measures of apparent predictability from price charts to predict future market prices. Subjects in our experiment predict both random walk times series, as in the seminal work by Bloomfield & Hales (2002) (BH), and stock price time series. We successfully...
Persistent link: https://www.econbiz.de/10013285949
We compare the performance of financial professionals (CFAs) with university students in four financial forecasting tasks ranging from simple lab prediction tasks to longitudinal field tasks. Although students and professionals performed similarly in the artificial forecasting tasks, their...
Persistent link: https://www.econbiz.de/10012880037
In this study, we examine how information provision affects the degree of overconfidence using an online experiment. The 4,210 experimental participants engaged in stock market prediction exercises were asked to evaluate their absolute and relative performance. We conducted a randomized...
Persistent link: https://www.econbiz.de/10012847379
We compare the performance of financial professionals (CFAs) with university students in four financial forecasting tasks ranging from simple lab prediction tasks to longitudinal field tasks. Although students and professionals performed similarly in the artificial forecasting tasks, their...
Persistent link: https://www.econbiz.de/10013297837
We investigate how individuals use measures of apparent predictability from price charts to predict future market prices. Subjects in our experiment predict both random walk times series, as in the seminal work by Bloomfied and Hales (2002) (BH), and stock price time series. We successfully...
Persistent link: https://www.econbiz.de/10013404042
We examine whether forecasters of earnings can be “nudged” into changing their forecasting behavior without altering their economic incentives or limiting their choices. We use a natural experiment on Estimize.com to quantify the effects of a nudge promoting a social norm of exerting one’s...
Persistent link: https://www.econbiz.de/10013491852
We reveal a novel channel through which market participants' sentiment influences how they forecast stock returns: their optimism (pessimism) affects the weights they assign to fundamentals. Our analysis yields four main findings. First, if good (bad) “news” about dividends and interest...
Persistent link: https://www.econbiz.de/10012834037
Predicted stock issuers (PSIs) are firms with expected “high-investment and low-profit” (HILP) profiles that earn unusually low returns. We carefully document important features of PSI firms to provide insights on the economic mechanism behind the HILP phenomenon. Top-PSI firms are...
Persistent link: https://www.econbiz.de/10012902654
The trading app Robinhood maintains a list of the 100 stocks most widely held by its users. Using a novel dataset of stock popularity with Robinhood user, I focus on new securities that enter the list. I document the strong effect that salience of new Top 100 listing events has on the attention...
Persistent link: https://www.econbiz.de/10012822971